-1=e^ipi

Congratulations on not understanding the difference between comparative statements and absolute statements. Way to take comparative statements from various studies and somehow pretend they support your absolute statements. Yes, cause it's not like our current more complicated tax system costs more to implement. Again, there is a difference between a comparative statement and an absolute statement, and none of these studies discuss the combination of guaranteed income and flat tax.

You look at this differently from me. For me it's a matter of maximization of expected utility for a person in society, so there is some reason to justify guaranteed income for children. Depression? Mental health issues? Not sure I agree with this.

Yes Mr. Economically illiterate, they will. Wage will be determined via supply and demand. If a business is unwilling to pay workers anything, then they will have difficulty finding workers. Also, low income workers will be arguably less desperate to find work if they have a guaranteed income, which increases their reservation wage. If an employer wants to pay someone benefits and an employee wants to work for those benefits then that is a Pareto improvement compared to the employer not having a worker and an employee not working.Two people are better off, no one is worse off. Do you reject the Pareto principle? Please define what you mean by 'afloat' are provide proof for your claim. 1. Lower wage isn't necessarily bad if more people are working. 2. Guaranteed income increases people's reservation wage for working, so a priori you can't say that wages will decline.

People have also being saying for generations that leprechauns exist. Just because people have been saying something, doesn't mean it is true. You haven't properly defined disproportionate and I doubt your definition is in agreement with mine. Looks to me that you are in denial about the lack of justification for your claim about it 'disproportionately' affecting the poor. It doesn't have to be overly complicated. And actually under log utility, it's difficult to justify much variation in guaranteed income.

But you don't support simplifying the tax system and reducing bureaucracy?

When did I ever say 25K? That still wouldn't be communism even if that were what I was advocating.

Are you trolling? Advocating the abolition of the progressive tax system, the minimum wage and employment insurance is communism?

You get paid for working. It's called a wage. That's your incentive. Also, you can get rid of things like welfare, minimum wage, employment insurance, the progressive tax system, etc.

Proof? This completely ignores other factors in that affect people's outcomes. Did the soldier on parliament hill choose to be shot by an Islamist sympathizer? Was that his control over his own destiny?

Yes. Are you trying to imply some sort of value judgement with this statement? Are you trying to say these able bodied people should not be on welfare? Was someone in this thread implying otherwise? Could you define more clearly what you mean by this statement and how I can empirically validate it? I don't think everyone fits into one of these 2 categories.

So you are suggesting that differences in economic outcome are primarily the result of laziness? Can you prove this claim? Also, do you understand the concept of a poverty trap?

Why would it slow upward mobility? With respect to how it taxes affect the labour-leisure decision, what matters is the marginal tax rate, not the effective tax rate. Does the coefficient of relative risk aversion not capture this? People will make theories, and provided those theories are falsifiable, they can be tested against the empirical data. Theories that are falsified can be thrown out. With respect to competing theories that haven't been falsified, you should give preference to the simplest theories (i.e. follow Occam's razor). There are lots of economists, or people that aren't really economists but have the title of 'economist', who are just plain wrong and should be ignored. Pigouvian taxes/subsidies?

I thought more about how to deal with disabled people, children, and people in remote areas. For disabled people, being disabled not only generally reduces one's wage, but also reduces the utility one obtains from leisure. So one could try to find some optimal extra guaranteed income to give to disabled people (which will likely depend on the disability) by modifying the utility function of the disabled people to take this into account. Though you would have to find some empirical way of measuring the loss of usefulness of leisure time for different types of disabilities. Perhaps you could look at the willingness to pay of disabled people to reduce their disability (such as obtaining prosthetics, getting cochlear implants, etc.). I will point out that in order for the reduction of effectiveness of leisure time to justify a higher guaranteed income to disabled people then d^2U/dl/dc must be negative, where U is utility, l is leisure, and c is consumption (most of the functional forms I was considering did not have this property; so it could be a bit problematic). For people in remote areas, if you simply index income with respect to price level then you can easily obtain how the guaranteed income should vary based upon location. Ultimately, what matters is consumption (which depends on both income and price level). For children, maybe instead of what I suggested earlier, you take the same approach as people in remote areas and treat children as normal but with a lower price level (lower food expenditure, clothing expenditure, etc.). This would result in children obtaining a lower guaranteed income than adults. I'm still a bit unsure how a logarithmic utility deals with the issue of dead people. For utility functions with constant relative risk aversion, dealing with people with 0 consumption gets difficult if the constant is 1 or greater. Though I guess if I look at consumption and leisure over a lifetime (perhaps discounted too) then perhaps this can be resolved (although that might result in no consumption smoothing behaviour).

As it should be. Finding the best tax policy should basically be a giant math problem.

Yes. Not necessarily. Probably, but I don't think it's necessarily true a priori. Edit: take for example 2 tax systems A and B that are all but identical except tax system B makes 49% of the poorest people $2 richer and 51% of the richest people $1 poorer. Even though tax system B makes the majority of people poorer relative to tax system A, tax system B has an on average richer society and has less income inequality, so should be preferred to tax system A.

Yes it is. Nope. It's not an exemption system for first $x of income to be tax free. All income is taxed at the same rate. And I never said that the guaranteed income should be $25000.

So according to some in this thread I am an extremist libertarian for supporting a flat tax and to others in this thread I am a socialist for supporting a guaranteed income. All without specifying how much flat tax and how much guaranteed income. As I said earlier, you could have a 0% flat tax and a $0 guaranteed income and you have extreme libertarianism, or you could have a 100% flat tax and redistribute all that money equally and you effectively have communism. Or you can have anything in between. I'm not sure if I accept the premise of your question.

Well it still would probably be the same for most adults. Though with respect to children or disabled people, I'm a bit stuck on how to determine the value. I guess for disabled people, you could assume that they have a similar utility function but don't have the option to work (so a social welfare maximizing government would give disabled people more money). For children, maybe you look at the relationship between monetary support for children & their long run outcome and pick a value that optimizes steady-state social welfare. I'll get their slowly. I think it is far better that the tax structure has a proper justification and the best possible tax structure is chosen, rather than what our political parties do (just choose completely arbitrary numbers with no basis and hope to get elected).

Not sure if you are responding to me. But if you are, is a flat tax socialist?

A logarithmic utility function is used to maximize growth of stock portfoilios. http://www.museful.net/2011/quantitative-finance/logarithmic-wealth-utility I wonder if that adds more support to the idea that a logarithmic utility function would arise due to evolution. A log utility function also makes calculations much easier compared to other constant relative risk aversion utility functions. It would definitely make it much easier to determine optimal mitigation response with respect to climate change.

Lot's of adults act like children and can't manage their finances. This may not be the majority, but there are people like this who exist. No, not 50%. 100%.

Proof? Why would tax shifting from income to consumption necessarily be a 'disaster'? How are you even measuring if something is a 'disaster'? You could also give lump sum transfers to children as well. They are people after all. Of course it would make sense for the parents/guardians to control that money. I would also suggest that disabled people have a larger lump-sum transfer. Maybe people in remote or Northern Areas should receive more as well. Maybe. But at the same time the more complicated you make things, the harder it is to implement (you will need a larger bureaucracy). A priori I don't exclude a high rate and I don't exclude a low rate. The rate would be chosen to optimize a social welfare function that I would justify on the basis of the Pareto Principle, the Pigou-Dalton Principle, the Anonymity Principle, Occam's Razor and empirical evidence. Right now I'm leaning towards the social welfare function being the sum of everyone's utility, where the utility function depends on consumption and leisure and the utility function has constant relative risk-aversion (and this constant would be determined empirically). I need to determine the social welfare function first though before I can quantify that.

9 years. The scenarios start in 2006; before that it is historical data.

Randomly skimmed this paper today and thought it was relevant to the discussion: http://obs.rc.fas.harvard.edu/chetty/files/curvature_aer.pdf It suggests using empirical evidence that the risk aversive behaviour of people suggests they have a logarithmic utility function. Edit: Here is something interesting on the biological origin of risk aversion and what it suggests about the functional form of the utility function. http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4273387/

I explained why based on empirical data RCP 8.5 cannot be considered representative of a business as usual scenario. It's interesting that in AR4 A1B was arguably the BAU representative BAU scenario, yet come AR5 8.5 is suddenly the BAU scenario. What a change: