Who Owns Human Capital?

43 Pages Posted: 11 Apr 2016 Last revised: 10 Mar 2018

See all articles by Lily Kahng

Lily Kahng

Seattle University School of Law

Date Written: April 6, 2016


This Article analyzes the tax law’s capital income preference through the lens of intellectual capital, an increasingly important driver of economic productivity whose value derives primarily from workers’ knowledge, experience and skills. The Article discusses how business owners increasingly are able to “propertize” labor into intellectual capital — to control their workers and appropriate the returns on their labor through the expansive use of intellectual property laws, contract and employment laws, and other legal mechanisms. The Article then shows how the tax law provides significant subsidies to the process of propertization and thereby contributes to the inequitable distribution of returns between business owners and workers. The Article’s analysis further reveals the tax law’s fundamental capital-labor distinction to be questionable, perhaps even illusory, an insight which has profound implications for the tax law.

Keywords: tax, intellectual capital, human capital, labor income, capital income

Suggested Citation

Kahng, Lily, Who Owns Human Capital? (April 6, 2016). 94 Washington University Law Review 607 (2017). Available at SSRN: https://ssrn.com/abstract=2760098

Lily Kahng (Contact Author)

Seattle University School of Law ( email )

901 12th Avenue
Seattle, WA 98122
United States

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