Essays in dynamic optimal taxation: working experience, unemployment scarring and poverty

This thesis investigates the design of optimal tax systems in dynamic environments. The first essay characterizes the optimal tax system where wages depend on stochastic shocks and work experience. In addition to redistributive and efficiency motives, the taxation of inexperienced workers depends on a second-best requirement that encourages work experience, a social insurance motive and incentive effects. Calibrations using U.S. data yield higher expected optimal marginal income tax rates for experienced workers for most of the inexperienced workers. They confirm that the average marginal income tax rate increases (decreases) with age when shocks and work experience are substitutes (complements). Finally, more variability in experienced workers' earnings prospects leads to increasing tax rates since income taxation acts as a social insurance mechanism. In the second essay, the properties of an optimal tax system are investigated in a dynamic private information economy where labor market frictions create unemployment that destroys workers' human capital. A two-skill type model is considered where wages and employment are endogenous. I find that the optimal tax system distorts the first-period wages of all workers below their efficient levels which leads to more employment. The standard no-distortion-at-the-top result no longer holds due to the combination of private information and the destruction of human capital. I show this result analytically under the Maximin social welfare function and confirm it numerically for a general social welfare function. I also investigate the use of a training program and job creation subsidies. The final essay analyzes the optimal linear tax system when there is a population of individuals whose perceptions of savings are linked to their disposable income and their family background through family cultural transmission. Aside from the standard equity/efficiency trade-off, taxes account for the endogeneity of perceptions through two channels. First, taxing labor decreases income, which decreases the perception of savings through time. Second, taxation on savings corrects for the misperceptions of workers and thus savings and labor decisions. Numerical simulations confirm that behavioral issues push labor income taxes upward to finance saving subsidies. Government transfers to individuals are also decreased to finance those same subsidies.

Process Monitoring and Defect Detection of Additive Manufacturing Using Inline Coherent Imaging

With applications ranging from aerospace to biomedicine, additive manufacturing (AM) has been revolutionizing the manufacturing industry. The ability of additive techniques, such as selective laser melting (SLM), to create fully functional, geometrically complex, and unique parts out of high strength materials is of great interest. Unfortunately, despite numerous advantages afforded by this technology, its widespread adoption is hindered by a lack of on-line, real time feedback control and quality assurance techniques. In this thesis, inline coherent imaging (ICI), a broadband, spatially coherent imaging technique, is used to observe the SLM process in 15 - 45 $\mu m$ 316L stainless steel. Imaging of both single and multilayer builds is performed at a rate of 200 $kHz$, with a resolution of tens of microns, and a high dynamic range rendering it impervious to blinding from the process beam. This allows imaging before, during, and after laser processing to observe changes in the morphology and stability of the melt. Galvanometer-based scanning of the imaging beam relative to the process beam during the creation of single tracks is used to gain a unique perspective of the SLM process that has been so far unobservable by other monitoring techniques. Single track processing is also used to investigate the possibility of a preliminary feedback control parameter based on the process beam power, through imaging with both coaxial and 100 $\mu m$ offset alignment with respect to the process beam. The 100 $\mu m$ offset improved imaging by increasing the number of bright A-lines (i.e. with signal greater than the 10 $dB$ noise floor) by 300\%. The overlap between adjacent tracks in a single layer is imaged to detect characteristic fault signatures. Full multilayer builds are carried out and the resultant ICI images are used to detect defects in the finished part and improve upon the initial design of the build system. Damage to the recoater blade is assessed using powder layer scans acquired during a 3D build. The ability of ICI to monitor SLM processes at such high rates with high resolution offers extraordinary potential for future advances in on-line feedback control of additive manufacturing.