In this article we quantify the aggregate, distributional and welfare consequences of two revenue neutral flat-tax reforms using a model economy that replicates the U.S. distributions of earnings, income and wealth in very much detail. We find that the less progressive reform brings about a 2.4%...

Even relatively poor people oppose high rates of redistribution because of the anticipation that they, or their children, may move up the income ladder. This ‘Prospect of Upward Mobility’ (POUM) hypothesis is commonly advanced to explain why democracies do not engage in large-scale...

This Paper analyses the economic issues associated with human cloning and new reproductive technologies. We analyse the incentives for human cloning and its implications for the long run distribution of skills and income. We analyse models of human cloning for different motives, focusing on...

Starting from a simple, descriptive model of individual income, an explicit link between the age composition of a population and the personal distribution of incomes is established. Demographic effects on income inequality are derived. Next, a pay-as-you-go financed state pension system is...

This paper analyses the interaction between the distribution of human capital, technological progress, and economic growth. It demonstrates the significant role of the distribution of human capital in the process of economic development. The evolutionary pattern of the human capital...

One reason why countries service their external debts is the fear that default might lead to shrinkage of international trade. If so, then creditors should systematically lend more to countries with which they share closer trade links. We develop a simple theoretical model to capture this...

This paper analyses the causes and consequences of offshore financial centers (OFCs). Since OFCs are likely to be tax havens and money launderers, they encourage bad behaviour in source countries. Nevertheless, OFCs may also have unintended positive consequences for their neighbours, since they...

We examine the role of non-economic partnerships in promoting international economic exchange. Since far-sighted countries are more willing to join costly international partnerships such as environmental treaties, environmental engagement tends to encourage international lending. Countries with...