Text of 4 Pop-Up Notes for FYI webessay, “Amazon.com’s Battle with California over an Internet Sales Tax”

#1 (of 4)

“eliminating private-sector waste” — Frank contends that “there’s actually considerably more waste in the private sector than in the public sector, and not just because the private sector is so much larger.” (Frank, The Darwin Economy 59) And even though the “search for ways to eliminate private waste is still in its infancy,” there is some good news: “private waste is actually much easier to eliminate than public waste. The positional consumption beast, it turns out, can be starved by relatively simple, unintrusive changes in incentives.” (Frank, The Darwin Economy 63) ::

#2 (of 4)

“In earlier work” — “Robert H. Frank, Luxury Fever, New York: Free Press, 1999; and Robert H. Frank, Falling Behind. Other authors have also discussed tax remedies for positional externalities. See, for example, Michael Boskin and Eytan Sheshinski, ‘Optimal Redistributive Taxation When Individual Welfare Depends on Relative Income,’ Quarterly Journal of Economics 92(4), 1978: 589–601; Yew Kwang Ng, ‘Diamonds Are a Government’s Best Friend: Burden-Free Taxes on Goods Valued for Their Values,’ American Economic Review 77(1), 1987: 186–191; Norman Ireland, ‘On Limiting the Market for Status Signals,’ Journal of Public Economics 53, 1994: 91–110; and Richard Layard, Happiness: Lessons from a New Science, London: Penguin, 2005.” (Frank, The Darwin Economy 222–223n7) ::

#3 (of 4)

“Implementing a progressive consumption tax would be straightforward.” — “For a detailed discussion, see Laurence Seidman, The USA Tax: A Progressive Consumption Tax, Cambridge, MA: MIT Press, 1997.” (Frank, The Darwin Economy 223n8) ::

#4 (of 4)

“the difference between their income and their annual savings, less a standard deduction” — “Loan repayments would be added to the savings total, thereby reducing potential tax liability. New borrowing would be subtracted from savings, increasing the potential tax. For homeowners annual housing consumption would be counted as the implicit rental value of their houses.” (Frank, The Darwin Economy 223n9) ::