An International Study of Tax Effects on Government Bonds

It is shown that coupon bonds alone are not sufficient to span time-dated claims on ordinary income, capital gains, and non-taxable wealth. In an incomplete bond market where the pure dated claims are not spanned by existing bonds, marginal rates of substitution between present consumption and pure dated claims on ordinary income, capital gains income, and non-taxable wealth, respectively, can differ across bondholders. However, the relative pricing of coupon bonds in each of these countries is shown to be consistent with the tax status of the major (non-tax-exempt) holders of government debt.     

Modelling the Determinants of Trans-Tasman Migration after World War II*

This paper identifies the economic and demographic factors responsible for migration flows between Australia and New Zealand by means of a probabilistic model of emigration in both directions. The largely uncontrolled flows between the two countries have the same determinants as those commonly found in studies of internal migration. The cost of migration (proxied by the real cost of air travel), labour market conditions and the potential earnings differential play a role, although the results are modified by the incidence of return migration and age composition.     

Occupational Segregation Indices in the Multidimensional Case: A Note*

An extension of an index of segregation recently proposed by Karmel and Maclachlan (1988) is suggested which allows the analysis of occupational segregation in the multidimensional case.     

LOCAL LABOR MARKETS,JOB MATCHING,AND URBAN LOCATION*

We present a new way of modeling local labor markets by linking the space of workers' skills and the physical space of cities. The key lesson of our analysis is that firms exploit workers in these two spaces by setting wages that are below the competitive level. The degree of monopsony power depends on the elasticity of the firm's labor pool, which is inversely related to the costs workers incur in commuting and acquiring skills. Our analysis thus shows how socioeconomic ghettos emerge as workers with poor skill matches are also those who incur the highest commuting costs.     

LONG‐RUN DETERMINANTS OF JAPANESE EXPORTS TO CHINA AND THE UNITED STATES: A SECTORAL ANALYSIS

During the period 1971–2007, Japanese sectoral exports to China and the United States depended on real exchange rate fluctuations and external demand (GDP of the country of destination). This result holds for both geographical destinations and for all six sectors under investigation in this study: foods, textiles, metal products, chemicals, non‐metal products, and machinery and equipment. For both China and the United States and for almost all sectors, the real exchange rate fluctuations and GDP have had the expected effects. Real appreciation of the yen and greater uncertainty derived from increased exchange rate volatility have reduced Japanese exports.     

INCENTIVES FOR CORRUPTIBLE AUDITORS IN THE ABSENCE OF COMMITMENT*

In the absence of commitment to auditing, we study the optimal auditing contract when collusion between an agent and an auditor is possible. We show that the auditor can be totally useless if the auditor's independence can be compromised with relative ease. Even very stiff sanctions on fraud will be unable to make auditing optimal. We then derive a demand for independent external auditing. We endogenize collusion cost as the cost from the risk of future detection. We also derive a justification for the focus of the recent audit reforms on penalties on CEOs in cases of audit fraud.