Growth,Employment and Taxation with Distortions in the Goods and Labour Market

Abstract. This paper analyses taxation in the presence of distortions in goods and labour markets in an endogenous growth model. The government disposes of capital, labour and consumption taxes. It is shown that the market solution leads to suboptimally low levels of growth and employment. However, available tax instruments are sufficient to attain the first‐best growth path in this economy. The paper further explores the relative distortion of capital and labour taxes. For plausible parametrisations of the model, lowering capital taxes dominate reductions in labour taxes in welfare terms.     

银行最优资本结构问题分析

本文在一个两时期模型中分别分析了无资本监管和实行资本监管时银行最优资本结构的选择。在这两种情况下,银行都可以选择一个最优资本结构以实现其价值最大化。在无资本监管时,当边际收益等于边际成本时,银行的资本结构达到最优;在实行资本监管的情况下,银行的最优资本数量是无监管时的最优资本数量再加上一个缓冲资本。     

Age-specific dynamic labor demand and human capital investment

To study the optimal age-specific labor demand and human capital investment at the firm level we extend the standard dynamic labor demand model by introducing ‘age’ as a second dynamic variable and distinguish between two types of workers: ‘low skilled’ and ‘high skilled’. Applying an age-structured optimal control model we derive qualitative features of the optimal age-specific hiring and training effort. For the case of a linear revenue and production function we prove that firms do not anticipate changes in adjustment costs in their optimal decisions. This result no longer holds if a nonlinear revenue or production function is considered.     

Policy Discrimination with and without Interpersonal Comparisons of Utility

Can the Pareto criterion guide policymakers who do not know the true model of the economy? If policymakers specify ex ante preferences for agents, then Pareto improvements from a distorted status quo are usually possible, and with more commodities than states, one can implement almost every Pareto optimum. Unlike the standard second welfare theorem, planners cannot dictate allocations: agents must trade. Unfortunately ex ante preferences impose interpersonal comparisons. If policymakers merely aim to maximize some social welfare function then optimal policies form an open set; hence small changes in the environment do not necessitate any policy response. Planners with symmetric information about agents can sometimes intervene without making interpersonal comparisons.     

Optimal Intervention Policies for a Small Monetary Economy

We analyze the gains from trade for a small cash-in-advance economy with endogenous labor supply and learning-by-doing in the accumulation of human capital. Contrary to previous findings, we show that free trade is not optimal independently of the relative amount of cash required for the purchase of each good. Furthermore, a monetary rule à la Friedman can eliminate distortions deriving from the cash-in-advance constraint only under segmented financial markets; in any case, it cannot restore the economic optimum. Finally, we identify government intervention policies, such as wage and export subsidies, that can be welfare improving.     

城市生态学视野下的动态适度人口规模——兼论上海人口发展的基本态势

提出城市适度人口规模不是一个静态的数值,而是动态的过程。不是一个先验的数值,而是系统决定的综合结果。建立了一个适度人口规模的概念性框架,即EFL模型,就是说合理和适度的人口规模是与之相联系的资源环境因素、功能和经济方式、空间区位状态共同决定的结果。生态系统的变动,综合决定了一定时期、一定标准下的城市人口适度规模,并决定了这一适度规模的变化趋势。基于这一思路,讨论了影响上海人口规模变动的积极因素和阻碍因素,从资源环境变化、城市功能变化和城市空间变化三个方面对上海适度人口规模的变动趋势作了基本判断,提出上海人口规模将出现先上升再下降的趋势。根据动态适度人口规模的观点,对城市人口综合调控和城市管理的有关问题提出了一些建议。     

Intraday Empirical Analysis and Modeling of Diversified World Stock Indices

This paper proposes an approach to the intraday analysis of diversified world stock accumulation indices. The growth optimal portfolio (GOP) is used as reference unit or benchmark in a continuous financial market model. Diversified portfolios, covering the world stock market, are constructed and shown to approximate the GOP, providing the basis for a range of financial applications. The normalized GOP is modeled as a time transformed square root process of dimension four. Its dynamics are empirically verified for several world stock indices. Furthermore, the evolution of the transformed time is modeled as the integral over a rapidly evolving mean-reverting market activity process with deterministic volatility. The empirical findings suggest a rather simple and robust model for a world stock index that reflects the historical evolution, by using only a few readily observable parameters. Mathematics Subject Classification: (1991) primary 90A12, secondary 60G30,62P20 JEL Classification: G10, G13     

Pollution Externalities in a Model of Endogenous Fertility and Growth

An endogenous growth model with human capital formation, pollution caused by production of consumption goods, and endogenous fertility decisions made by altruistic agents with infinite horizons is presented. Consequences for optimal policy of modelling fertility as an explicit decision variable are examined. Because ordinary lump-sum transfers to individuals are no longer neutral, either revenue from a pollution tax must be redistributed to dynasties (working as an implicit tax on child births), or lump-sum transfers must be supplemented with an explicit fertility tax. Alternatively, the government can avoid distortions of the fertility decisions by maintaining an appropriate public debt. When abatement is highly productive, it can be optimal to subsidize fertility in order to increase total production.     

Investment Horizon and Composition of Optimal Portofolio: International Evidence

Little attention has been paid in the literature to the impact of different investment horizons on the portfolio compositiondespite its importance to portfolio managers. One exception isthe study by Gunthorpe and Levy (1994) on the U.S. stock market.Our paper extends the same study to the stock markets of Japan,Hong Kong and Korea. Using 40 individual stocks in each market,our results support those of Gunthorpe and Levy (1994) in thatthe composition of an optimal portfolio depends heavily on theinvestment horizon. When the investment horizon lengthens, theproportion of defensive stocks becomes larger while that ofaggressive stocks becomes smaller.     

Testing for Vertical Fiscal Externalities

The purpose of this paper is to design a test of whether the vertical external effects associated with tax base sharing among local and regional governments have become internalized via the intergovernmental transfer system. Such tests are important in the sense that the income tax rates chosen by different levels of government will generally be correlated, even if the resource allocation is optimal from society's point of view. By using panel data for the Swedish local and regional public sectors, the results imply that an increase in the regional income tax rate induces the municipalities in the region to decrease their income tax rates. In addition, we are able to reject the null hypothesis that the vertical external effects have become internalized.