House prices and immovable property tax: Evidence from OECD countries

This paper studies the impact of changes in immovable property tax revenues on the growth rate of house prices by analysing a panel of 34 OECD countries over the period 1970–2014. Starting from the annual series of immovable property tax revenues, we isolate years of significant shifts in the property tax regime and study their impact on house prices. We find a strong negative relationship between increases in immovable property tax revenues and house prices. This relationship is robust to the inclusion of cyclical determinants of house prices, country and year fixed effects, and country‐specific linear trends. We also propose an instrumental variable strategy based on countries’ legal origins that confirms a statistically significant negative impact of such taxes in the short run.     

The International Monetary System in a Real Economy

The paper offers a brief analysis of the reasons why European Monetary Union receives the support of academics and operators alike as a great step forward in constructing global monetary stability. Cooperation that will lead to a stable international monetary system is recognized as a primary goal for both the real economy and high finance. Technological innovation, increasingly global markets, unlimited access to capital, the disappearance of national sovereignty and, above all, the heightened role of values in the business environment, all contribute to the realization of this goal and to a stronger world economy.