De Gustibus not est Taxandum

Bryan Caplan quotes a passage from  Daniel Kahneman's Thinking, Fast together with Slow (which I get got non read, simply invention to):

A large-scale report of the touching on of higher education... revealed hitting show of the lifelong effects of the goals that immature people ready for themselves. The relevant information were drawn from questionnaires collected inwards 1995-1997 from or together with then 12,000 people who had started their higher instruction inwards elite schools inwards 1976. When they were 17 or 18, the participants had filled out a questionnaire inwards which they rated the destination of "being really well-off financially" on a 4-point scale ranging from "not important" to "essential."...

Goals brand a large difference. Nineteen years afterwards they stated their fiscal aspirations, many of the people who wanted a high income had achieved it. Among the 597 physicians together with other medical professionals inwards the sample, for example, each additional signal on the money-importance scale was associated alongside an increment of over $14,000 of chore income inwards 1995 dollars!

In other words, 1 argue that people differ inwards their incomes is that some people tending to a greater extent than near having a high income than others. To seat it inwards geekspeak, preferences over pecuniary goods (say, consumption) together with nonpecuniary goods (say, leisure) are heterogeneous. Bryan goes on to advise that to the extent this is true, it weakens the instance for income redistribution.

He is absolutely right.  Most of the literature on optimal taxation together with redistribution, next Mirrlees, assumes homogeneous preferences.  But Matthew Weinzierl has a recent newspaper on preference heterogeneity, which shows " to the extent that variation inwards income is due to preference differences rather than productivity differences, the optimal extent of redistribution is lower, together with the fail of preference heterogeneity biases the results of conventional optimal taxation analyses inwards favor of redistribution of income."

By the way, the championship of this ship service is taken from the Weinzierl paper.
Sumber http://gregmankiw.blogspot.com/