2015 Articles
In Praise of Frank Ramsey's Contribution to the Theory of Taxation
Frank Ramsey's brilliant 1927 paper, modestly entitled, ‘A contribution to the theory of taxation’, is a landmark in the economics of public finance. Nearly a half century later, through the work of Diamond and Mirrlees (1971) and Mirrlees (1971), his paper can be thought of as launching the field of optimal taxation and revolutionising public finance.1 In this short celebratory article, I briefly describe Ramsey's basic insights (Section 1), and the early history of the development of the ideas based on Ramsey's paper (Section 2). While several of these crucial developments showed that Ramsey's conclusions held under more general conditions than he had assumed, later analyses showed crucial qualifications, so that the policy relevance of Ramsey's analysis may be limited.
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Also Published In
- Title
- Economic Journal
- DOI
- https://doi.org/10.1111/ecoj.12187
More About This Work
- Academic Units
- Economics
- Published Here
- April 15, 2019
Notes
Also published as NBER Working Paper 20530, October, 2014