The growth effects of tax rates in the OECD

This paper explores the merits of macro‐ and micro‐based tax rate measures within an open economy “fiscal policy and growth” model. Using annual data for 15 OECD countries we find statistically small, non‐robust long‐run growth effects of macro‐based average tax rates on capital income and consumption, but some evidence for average labour income tax effects. Changes in “micro” marginal income tax rates at both the personal and corporate levels yield statistically robust GDP responses of modest size. Both domestic and foreign corporate taxes appear relevant. In general, tax effects on GDP operate largely via factor productivity rather than factor accumulation.     

Evaluations of Infinite Utility Streams: Pareto Efficient and Egalitarian Axiomatics

This investigation focuses on the aggregation of infinite utility streams by social welfare functions. We analyze the possibility of combining Pareto‐efficiency and Hammond Equity principles when the feasible utilities for each generation are [0, 1] and the natural numbers. In the latter case, the Hammond Equity ethics can be combined with non‐trivial specifications of the Pareto postulate, even through anonymous social welfare functions. As a consequence, any evaluation of infinite utility streams that verifies a mild specification of the Paretian axiom must exert some interference on the affairs of particular generations.     

Self-interest and fairness: self-serving choices of justice principles

We introduce non-enforceable property rights over a bargaining surplus in a dictator game with production, where the agent’s effort is differentially rewarded and subsequently determines the size of the surplus. Using experimental data, we elicit individual preferences over the egalitarian, accountability and libertarian principles and provide evidence to support the inability of these justice principles to individually account for the observed behavior. We show that the justice principle that can be used to explain dictators’ choices depends on whether dictators are paid more or less than recipients for their effort. Our findings suggest that dictators do employ justice principles in self-serving ways and choose in each context the justice principle that maximizes their financial payoffs.     

Determinants of Bank Debt in a Continental Financial System: Evidence from Spanish Companies

We test hypotheses about the structure of corporate debt ownership and the use of bank debt by firms in a civil‐law country, Spain. We focus on bank debt effects in the presence of information asymmetries and agency costs, and on efficient versus inefficient firm liquidation. We find that the relation between growth opportunities and bank financing is not as strong as the one found in common‐law countries, that there is a positive relation between firm size and the proportion of bank debt used, and that firms closer to bankruptcy and highly leveraged are more likely to use bank debt.     

Social Tourism and Healthy Ageing

Recent research in social tourism notes possible links between tourism participation and improvements in health. However, there is a lack of quantitative evidence concerning the potential links between tourism participation and self‐reported health amongst older people. An ageing society requires measures to promote independent living and enhance older people's quality of life. This paper provides evidence that older tourists are more active and healthy than non‐tourists, from a study comparing health perceptions amongst Spanish older people. The results provide tentative conclusions of causal relationships between tourism and dimensions of physical and mental health through a Structural Equation Model. Copyright © 2015 John Wiley & Sons, Ltd.     

Minimum Wage: Does it Improve Welfare in Thailand?

We study the causal impact of the minimum wage on labor market outcomes, household consumption, inequality and poverty in Thailand by relying on policy variation in minimum wages over time across provinces. We find that minimum‐wage increases have a large and significant impact on the likelihood of working in the uncovered sector among workers with elementary education. However, the impact is very small and insignificant among other labor market groups. In contrast, the minimum wage has large positive effects on the formal sector wages of low‐earning workers, such as the young, elderly and low educated. Increases in the minimum wage are associated with reductions in household poverty and consumption inequality at the bottom half of the distribution.     

The functional-psychological continuum in the cognitive image of a destination: A confirmatory analysis

This paper analyses the cognitive component of the image of a destination from a dual perspective. Firstly, we study its composition by positing three positions on a continuum: functional, mixed and psychological, which are analysed using confirmatory factor analysis. Secondly, we study the influence of these components on tourists' overall image of the destination and on their future behaviour intentions, using structural equation analysis. The results show that the psychological and functional components exercise the greatest influence on the overall image of the destination. Overall image was found to influence future behaviour intentions consistently, while the functional component is relevant for revisit intention and the psychological component for the intention to recommend.     

Can migration reduce civil conflicts as an antidote to rent-seeking?

In this paper, I investigate whether access to migration reduces the positive effect of natural resources on the onset of civil conflicts shown in the literature. There is a negative and significant correlation between the interaction variable “migration rate-natural resources” and the probability of outbreak of civil wars, showing that the effect of natural resources is conditional on the migration rate. Simulations to quantify the marginal effects of the interaction term show that a migration rate equal to 6% or higher dampens the effect of natural resources on civil wars. To address the potential endogeneity problem in estimating the relationship between civil conflicts and migration, although I distinguish economic migrants from refugees, I also use an IV approach. In this respect, the negative effect of the two interacting variables on the probability of outbreak of civil wars remains robust after having instrumented the migration rate by using the gravity-based predicted emigration rate. Given the endogenous nature of the ratio of primary exports to GDP, in addition, the study directly utilizes the emigration rates as an alternate robust method to estimate the primary issue on civil conflicts. The results show that only the civil conflicts caused by natural resources are negatively impacted by emigration rates.     

Is a Tax Cut on Cultural Goods Consumption Actually Desirable? A Microsimulation Analysis applied to Spain*

Proposals for tax cuts on cultural goods represent an ongoing debate in cultural policy. The main aim of this paper is to shed some light on this debate using microsimulation tools. First, we have estimated an Almost Ideal Demand System for 19 different groups of goods, including cultural goods. Expenditure and price elasticities have been obtained from this model. Using this information, three alternative cuts in the VAT rate on cultural goods have been microsimulated and evaluated in terms of revenue and welfare. These types of fiscal reforms will lead to welfare and efficiency gains that can be described as regressive.