Essays on the taxation of capital gains

The first two essays study capital-gains taxation. The third essay develops a computation method which guided the numerical experiments of the second essay.;The first essay develops a general equilibrium model with taxation of nominal capital gains, inflation and business turnover. Despite its simplicity, a parameterized version of the model mimics salient features of the turnover of unincorporated businesses in the U.S. economy. I show that the taxation of inflationary gains has a significant effect on the allocation of resources to small businesses.;In the second essay I study the effects of taxing capital gains from the sale of commonly held stocks. This kind of analysis has been limited within the general equilibrium context by the lack of tools. In this essay I develop a tractable model for addressing capital-gains taxation. I calibrate the model so that selected steady-state observations matches counter-parts for the U.S. economy. I find that taxing capital gains upon realization imposes sizable welfare costs by interfering with consumption smoothing. I also find that taxing accrued capital gains at 7.7 percent generates the same tax revenues as taxing realized capital gains at 28 percent.;In the third essay I solve the problem of concave interpolation on the plane. Data generated by a concave function is given. The problem is to find an interpolant that is concave and cheap to compute. I consider the smallest concave function performing as interpolant. I find it can be implemented with information from particular neighboring points. The results are drawn from a particular intersection between plane geometry and convex analysis, which may be of interest for its own sake.