Re: Land, Labour and Capital Taxation....
lev_lafayette_at_yahoo.com.au
Date: 12/15/04
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Date: 15 Dec 2004 12:58:43 -0800
Igor wrote:
> lev_lafayette@yahoo.com.au wrote:
>
>
> > Fair enough.
> >
> > But that's why we have a market. It is an intersubjective
determination
> > of productive value. Now sure, people will choose other criteria
(e.g.,
> > aesthetic values) on why one block of land is better than another,
but
> > economist must assume the rational econonmic actor in making their
> > decisions.
> >
>
> That isn't the problem with calculating rent. The problem is exactly
> that rational actors are play. There will things like infrastructure,
> distance from shipping networks, distances from where a lot people
live,
> etc that are have nothing to do with economic rent that will effect
> market rent. In some ways all of these are IMPROVEMENTS that make the
> land more valuable. This is not what we want to tax.
I think those things are economic rent, insofar that they change the
productivity of the land.
It is certainly easier to include those infrastructure advantages when
making the calculation as well.
> I do not think we can get it exactly right and get the textbook
Georgian
> scenario. Applications of theory such as this are rarely possible to
get
> exactly right when implemented. However, I do agree that land taxes
are
> likely the least intrusive.
Even if this is what George meant to say, I don't think one has to be
"textbook Georgian". He is no demi-god and London to a brick he made
mistakes like anyone else. The pragmatic task in front of us is how to
provide public revenues and social welfare without taxes on
productivity.
Land tax based on market values seems to be the quickest and simplest
way to do this.
> This is because I believe there is a
> significant number of workers who react highly to wage changes. This
is
> somewhat contentious. If in the extermely people work 40 hours a week
> regardless of wages then payroll taxes do not distort. I do not
believe
> this is the case but I can only say that it is my BELIEF that the
> deadweight loss to payroll taxes is big. Empirical evidence is not
clear.
I think you're right there. All one has to do is ask how much money and
time a sample of businesses spends on payroll tax compliance and
multiply it from there.
Regards,
Lev
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