Jump to ContentJump to Main Navigation
The Economists' VoiceTop Economists Take On Today's Problems$
Users without a subscription are not able to see the full content.

Joseph Stiglitz, Aaron Edlin, and J. Bradford DeLong

Print publication date: 2011

Print ISBN-13: 9780231143653

Published to Columbia Scholarship Online: November 2015

DOI: 10.7312/columbia/9780231143653.001.0001

Show Summary Details
Page of

PRINTED FROM COLUMBIA SCHOLARSHIP ONLINE (www.columbia.universitypressscholarship.com). (c) Copyright University of Minnesota Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in CUPSO for personal use.date: 19 September 2021

Progressive Consumption Taxation as a Remedy for the U.S. Savings Shortfall

Progressive Consumption Taxation as a Remedy for the U.S. Savings Shortfall

(p.170) Chapter 20 Progressive Consumption Taxation as a Remedy for the U.S. Savings Shortfall
The Economists' Voice

Robert H. Frank

Columbia University Press

This chapter addresses the question of why American savings rates, always low by international standards, have fallen sharply in recent decades. It argues that low U.S. savings rates are in large part a result of pressures to keep pace with community spending standards—pressures that have been exacerbated by rising income and wealth inequality. Replacing the income tax with a progressive consumption tax would stimulate additional savings by reducing the price of future consumption relative to current consumption as compared to its price under the current income tax. Perhaps more important, a progressive consumption tax would stimulate savings by altering the social context that shapes spending decisions.

Keywords:   savings rates, community spending standards, wealth inequality, income tax, consumption tax

Columbia Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs, and if you can't find the answer there, please contact us .