This book discusses the impact of taxation on economic growth, employment, investment, consumption and the environment. The public finance literature commonly distinguishes between three major functions of taxation: the traditional function of raising revenue to finance government expenditure;...

The response of an economy to a windfall of foreign exchange (be it aid or natural resource revenues) is often constrained by absorptive capacity. We provide a micro-founded analysis of absorption constraints, based on the idea that expanding the economy’s capital stock (in aggregate or...