The internal market in Europe will greatly increase the international mobility. How will this affect fiscal policy in different countries? The authors consider taxation of capital in a two-country model where a democratically chosen government in each country chooses tax policy. Higher capital...

Is corruption systematically related to electoral rules? A number of studies have tried to uncover economic and social determinants of corruption but, as far as we know, nobody has yet empirically investigated how electoral systems ináuence corruption. We try to address this lacuna in the...

This chapter surveys the recent literature on the theory of macroeconomic policy. We study the effect of various incentive constraints on the policy making process, such as lack of credibility, political opportunism, political ideology, and divided government. The survey is organized in three...