Rich people are less receptive to tax and price changes: searching the evidence of the hypothesis

Illyashenko Kostyantyn Viktorovych
Сandidate of Еconomic Sciences, Associate Professor, Associate Professor of Finance and Credit Department,
Sumy State University, Uktraine
Illyashenko Tetyana Olexiivna
Сandidate of Еconomic Sciences, Associate Professor, Associate Professor of Finance and Credit Department,
Sumy State University, Uktraine
Kolomiiets Uliana Volodymyrivna
PhD-student,
Center for Economic Research and Graduate Education – Economic Institute, Czech Republic

  • The main classical tax theory assumption is that all agents are rational, however, it does not hold in the real world. Consequently, this may lead to inefficiencies in the tax models in which consumer’s rationality is taken as given. The article contains an attempt to prove that rich people are more rational compared with poor people; nevertheless, they are more attentive to the quality of the goods. Therefore, the rich people are less insensitive to price and tax changes then poor ones.
  • price, tax, irrational consumer behavior, public economics, utility maximization, attention, inattentiveness.
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  • Illyashenko K. V. Rich people are less receptive to tax and price changes: searching the evidence of the hypothesis [Internet source] / K. V. Illyashenko, T. O. Illyashenko, U. V. Kolomiiets // Economic Processes Management: International Scientific E-Journal. – 2015. – № 2. – Access mode: http://epm.fem.sumdu.edu.ua/download/2015_2/2015_2_21.pdf