Tax Policy Colloquium on 1/31/12 - Alex Raskolnikov on tax versus non-tax law and economics

Yesterday at the NYU Tax Policy Colloquium, Alex Raskolnikov presented his paper, "Accepting the Limits of Tax Law and Economics." The paper argues that, as law and economics in the law schools goes, that in tax has been generally less "successful" than that in other areas - say, antitrust law or studying and evaluating the Uniform Commercial Code - in two senses: less able to generate relatively clear and widely accepted right answers concerning particular issues, and less influential in guiding policymakers, in particular the courts.

In a sense, one could compare the paper to Fellini's 8½. Just as 8½ is a film about not being able to make a film, so this is to some extent a paper about the difficulty of writing a paper.

Alex and I appear to agree, however, that the reason for our lesser success (as the paper uses this term) is our having a tougher job. In particular, tax policy analysis requires considering distribution issues that the rest of law and economics typically brushes aside (and indeed expressly leaves to us), and, with lump-sum taxes ruled out, we are required to labor in the thickets of second-best analysis, which is never particularly clean or clearcut.

I suppose my ego is sufficiently bound up in the question of how our field has performed that I don't especially like reading about our lack of "success" - in particular, when I myself code it (without any substantive disagreement with what Alex says) as a laudable reflection of our having collectively taken on tough and interesting issues of great theoretical complexity and practical importance. And how important are answers and influence, as compared to advancing intellectual understanding? (Which I believe we have collectively done.) Tastes may differ about this.