European Business Schools Librarian's Group

Working Papers,
Copenhagen Business School, Department of Economics

No 05-1998: A note on interpreting consumption tax incidence in OLG models

Niels Kleis Frederiksen
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Niels Kleis Frederiksen: Department of Economics, Copenhagen Business School, Postal: Department of Economics, Copenhagen Business School, Solbjerg Plads 3 C, 5. sal, DK-2000 Frederiksberg, Denmark

Abstract: This note discusses the generational incidence of consumption taxes in an OLG framework. The objective is to highlight the channels through which an increase in, e.g., a VAT redistributes income across generations. It turns out that with labor supply exogenous VAT incidence is very similar to the impact of a PAYG pension system or government debt.

Keywords: na

JEL-codes: G10

16 pages, January 1, 1998

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