Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence
This research conducts a comparative study of the economic growth and income distribution effects of consumption and comprehensive income taxes by introducing them into an endogenous economic growth model with human capital formation. We obtained the following results. First, consumption tax does no...
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MDPI AG
2025-07-01
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| Online Access: | https://www.mdpi.com/2227-7099/13/7/201 |
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| author | Lingling Sun Yasuyuki Nishigaki |
| author_facet | Lingling Sun Yasuyuki Nishigaki |
| author_sort | Lingling Sun |
| collection | DOAJ |
| description | This research conducts a comparative study of the economic growth and income distribution effects of consumption and comprehensive income taxes by introducing them into an endogenous economic growth model with human capital formation. We obtained the following results. First, consumption tax does not directly suppress economic growth. Instead, it promotes physical capital accumulation, which causes favorable income distribution effects for capital income earners. Second, comprehensive income tax has the direct effects of suppressing economic growth, restraining physical capital accumulation, and increasing labor supply. Third, comprehensive income tax promotes human capital accumulation, which causes a more favorable income distribution for workers. Finally, by conducting an empirical study using international panel data, we show the growth effects of human capital and educational investment and the differentiated growth effects of income and consumption taxes. |
| format | Article |
| id | doaj-art-b471bc65e7a543d19c98f30ff8336fe5 |
| institution | Kabale University |
| issn | 2227-7099 |
| language | English |
| publishDate | 2025-07-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj-art-b471bc65e7a543d19c98f30ff8336fe52025-08-20T03:36:18ZengMDPI AGEconomies2227-70992025-07-0113720110.3390/economies13070201Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical EvidenceLingling Sun0Yasuyuki Nishigaki1Ningbo City College of Vocational Technology, 298 Heyi Road, Haishu District, Ningbo 315010, ChinaGraduate School of Economics, Faculty of Economics, Ryukoku University, 67 Fukakusa Tsukamotocho, Fushimi Ward, Kyoto 612-8577, JapanThis research conducts a comparative study of the economic growth and income distribution effects of consumption and comprehensive income taxes by introducing them into an endogenous economic growth model with human capital formation. We obtained the following results. First, consumption tax does not directly suppress economic growth. Instead, it promotes physical capital accumulation, which causes favorable income distribution effects for capital income earners. Second, comprehensive income tax has the direct effects of suppressing economic growth, restraining physical capital accumulation, and increasing labor supply. Third, comprehensive income tax promotes human capital accumulation, which causes a more favorable income distribution for workers. Finally, by conducting an empirical study using international panel data, we show the growth effects of human capital and educational investment and the differentiated growth effects of income and consumption taxes.https://www.mdpi.com/2227-7099/13/7/201consumption taxcomprehensive income taxendogenous economic growthincome distributionhuman capitalpolicy |
| spellingShingle | Lingling Sun Yasuyuki Nishigaki Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence Economies consumption tax comprehensive income tax endogenous economic growth income distribution human capital policy |
| title | Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence |
| title_full | Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence |
| title_fullStr | Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence |
| title_full_unstemmed | Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence |
| title_short | Effect of Comprehensive Income and Consumption Taxes on Human Capital, Economic Growth, and Income Distribution: Endogenous Economic Growth and Empirical Evidence |
| title_sort | effect of comprehensive income and consumption taxes on human capital economic growth and income distribution endogenous economic growth and empirical evidence |
| topic | consumption tax comprehensive income tax endogenous economic growth income distribution human capital policy |
| url | https://www.mdpi.com/2227-7099/13/7/201 |
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