countries; in particular, the effective marginal tax rate on labor income. The population of countries considered is the G-7 countries, which are major advanced industrial countries. The surprising fi nding is that this marginal tax rate accounts for the predominance of differences at points in time

-one loss (misclassification rate) even when this assumption is violated by a wide margin. The region of quadratic-loss optimality of the Bayesian classifier is in fact a second-order infinitesimal fraction of the region of zero-one optimality. This implies that the Bayesian classifier has a much greater

with a single loop • Unless all the conditional probabilities are deter ministic, belief propagation will converge. • There is an analytic expression relating the cor rect marginals to the loopy marginals. The ap proximation error is related to the convergence rate of the messages -the faster

This paper extends a previously circulated unpublished paper ("A Preliminary Report on the

ABSTRACT: Previous studies have shown that the optimal marginal tax rate at the bottom of the income distribution may be positive, negative, or even zero. This paper reexamines this problem in a unified framework and tries to evaluate the arguments. It turns out that the case for positive marginal

principle (according to which the optimal tax rate equals the marginal environmental damages). Both models indicate, contrary to what several analysts have suggested, that the optimal tax rate on emissions of a given pollutant is generally less than the rate supported by the Pigovian principle. Moreover

of high mass consumption lie the problems which are beginning to arise in a few societies, and which may arise generally when diminishing relative marginal utility sets in for real income itself. Blackwell Publishing and Economic History Society These descriptive categories are rooted in certain dynamic

; the outside options of exporting to or not serving the foreign market are explicitly modelled. Particular attention is paid to the impact of profit taxes; the separate roles of effective average and marginal tax rates are identified. The model is applied to a panel of US firms locating in the European market

, the optimal transfer program is a classical Negative Income Tax program with a substantial guaranteed income support and a large phasing-out tax rate. However, when behavioral responses are concentrated along the extensive margin, the optimal transfer program is similar to the Earned Income Tax Credit

This paper critically surveys the large and growing literature estimating the elasticity of taxable income with respect to marginal tax rates (ETI) using tax return data. First, we provide a theoretical framework showing under what assumptions this elasticity can be used as a sufficient statistic