Abstract
The model is of choice of hours worked and net of tax income by workers who vary in their skill levels. All workers face the same initial linear income tax schedule. We construct a set of linear income tax schedules, differeing in their degree of progressivity, and then allow each worker to choose under which schedule he shall be taxed. No worker is worse off under the option, and no worker pays less tax. Most workers are better off, and pay more tax. Hence, the optional tax system Pareto dominates the initial tax system.
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