We study the strategic incentives of regional governments to allocate their budget to public investment and to public consumption expenditures against the background of an incentive-compatible redistribution policy set by the central government. Regional investment changes the productivity...

Critical-level (CL) utilitarianism with both fixed and variable critical levels is applied to the problem of redistribution in a federation with free mobility. We are interested in intra-regional inequality when redistribution policies are organized decentrally in a federation. Due to free...

In a multi-country general equilibrium economy with mobile capital and rigidwage unemployment, countries may differ in capital endowments, production technologies and rigid wages. Governments tax capital at the source to maximize national welfare. They account for tax base responses to their tax...

This study analyzes the interaction between distorted election choices and the architecture of government with a focus on the implications for the accountability of politicians. Contrasting centralized with decentralized political systems, it is shown that centralization is likely to result in...

In an integrated dynamic general equilibrium model of the economy and the ecosystem humans and wildlife species compete for land and prey biomass. We introduce a competitive allocation mechanism in both submodels such that economic prices and ecosystem prices guide the allocation in the economy...

Scientific expertise suggests that mitigating extreme world-wide climate change damages requires avoiding increases in the world mean temperature exceeding 2° Celsius. To achieve the two degree target, the cumulated global emissions must not exceed some limit, the so-called global carbon...

This note investigates the suitability of unilateral consumption taxes for alleviating climate change in a two-period two-country general equilibrium model with a finite stock of fossil fuel. We analyze the incidence of a unilateral consumption tax in the first period on world carbon emissions....

Economists have a good understanding of intra-economic interdependence and a mature methodology of modeling it. Ecologists focus on the complex and sensitive interactions of species in ecosystems. This paper's objective is to suggest a new micro-foundation of ecosystem analysis based on economic...