Saturday, January 07, 2023

MIT: Should we tax robots? A purportedly optimal tax policy suggests a small tax to begin with

The revolution of robots in our daily lives and economy has not yet begun, but ideologues are already busy trying to figure out how to tax robots!

Government greed knows no bounds! Demands for Government enforced income redistribution are immediately raised!

As usual, these taxmen want to start with low taxes to start with. Remember, once a new tax is introduced, it rarely ever is revoked or phased out. Further, taxes usually only go up!

These wannabe economists (demagogues) link robotic technology with foreign trade, which is by itself dubious!

"“Our finding suggests that taxes on either robots or imported goods should be pretty small,” says Arnaud Costinot, an MIT economist demagogue."

"... Now a study by MIT economists scrutinizes the existing evidence and suggests the optimal policy in this situation would indeed include a tax on robots, but only a modest one. The same applies to taxes on foreign trade that would also reduce U.S. jobs, the research finds.   ..."

From the abstract:
"Technological change, from the advent of robots to expanded trade opportunities, creates winners and losers. How should government policy respond? We provide a general theory of optimal technology regulation in a second–best world, with rich heterogeneity across households, linear taxes on the subset of firms affected by technological change, and a nonlinear tax on labor income. Our first set of results consists of optimal tax formulas, with minimal structural assumptions, involving sufficient statistics that can be implemented using evidence on the distributional impact of new technologies, such as robots and trade [???]. Our final results are comparative static exercises illustrating, among other things, that while distributional concerns create a rationale for non-zero taxes on robots [??? you need a PhD for this kind of baloney!] and trade, the magnitude of these taxes may decrease as the process of automation and globalization deepens and inequality increases."

Should we tax robots? | MIT News | Massachusetts Institute of Technology Study suggests a robot levy — but only a modest one — could help combat the effects of automation on income inequality in the U.S.

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