Hacker News new | ask | show | jobs
by dev_dull 2421 days ago
Norway’s top personal tax rate is similar to the US (39%, which is less than what some people pay in high cost of living states here).

The difference, as I’m sure you already know, is state oil revenue, and that can’t last forever even with sovereign wealth funds.
2 comments
Arn_Thor 2421 days ago
Sweden, Finland and Denmark are also very apt examples, none of whom have oil.

(Norway also uses very little of its oil revenue, saving most of it)

link
pnako 2421 days ago
Why not? You could have a welfare system that redistributes any excess return from the fund above long-run inflation rate, and it would be sustainable.
link
AnthonyMouse 2421 days ago
A significant fraction of the historical rate of return on capital is attributable to the combination of population growth and inflation. Without those the size of the fund you would need to cover a material fraction of government spending would be implausibly large.

Sovereign wealth funds also aren't all that different economically from taxation, in the sense that the profits from what the fund is invested in go to funding government programs rather than being reinvested in private enterprise. If the fund was large enough to be relevant, that would become an issue for the economy.

link