Taxing Identity: Theory and Evidence from Early Islam

84 Pages Posted: 7 May 2019

See all articles by Mohamed Saleh

Mohamed Saleh

University of Toulouse 1 - Toulouse School of Economics (TSE)

Jean Tirole

University of Toulouse 1 - Industrial Economic Institute (IDEI); University of Toulouse 1 - Groupe de Recherche en Economie Mathématique et Quantitative (GREMAQ); Centre for Economic Policy Research (CEPR)

Date Written: April 2019

Abstract

A ruler who does not identify with a social group, whether on religious, ethnic, cultural or socioeconomic grounds, is confronted with a trade-off between taking advantage of the out-group population's eagerness to maintain its identity and inducing it to "comply" (conversion, quit, exodus or any other way of accommodating the ruler's own identity). This paper first analyzes the ruler's optimal mix of discriminatory and non-discriminatory taxation, both in a static and an evolving environment. The paper then uses novel data sources to test the theory in the context of Egypt's conversion to Islam between 641 and 1200. The evidence is broadly consistent with the theoretical predictions.

Keywords: identity taxation, Islam, Laffer Curve, Legitimacy, Poll tax

JEL Classification: D82, H2, N45, Z12

Suggested Citation

Saleh, Mohamed and Tirole, Jean, Taxing Identity: Theory and Evidence from Early Islam (April 2019). CEPR Discussion Paper No. DP13705. Available at SSRN: https://ssrn.com/abstract=3383963

Mohamed Saleh (Contact Author)

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Jean Tirole

University of Toulouse 1 - Industrial Economic Institute (IDEI) ( email )

Place Anatole France
21 Allees de Brienne
F-31042 Toulouse Cedex
France
+33 5 61 12 8642 (Phone)
+33 5 61 12 8637 (Fax)

University of Toulouse 1 - Groupe de Recherche en Economie Mathématique et Quantitative (GREMAQ) ( email )

Manufacture des Tabacs
21 Allees de Brienne
Toulouse, 31000
France

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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