this paper we show that, when elastic labor supply is considered via Cobb Douglas preferences, dynamic inefficiency of OLG economies, while being still a necessary condition, is no longer sufficient for an internal public debt increase to generate a Pareto improvement. This is due to the fact...

This paper analyzes an endogenous growth model where agents have different factor endowments and government finances public expenditure by imposing two flat-tax rates, one on capital income and one on labor income. The main finding is that, in the absence of lump-sum redistributions,...

The paper investigates the role of progressive income taxation in the frame of the basic multiplier-accelerator model in continuous time. It is shown that, while the proportional taxation is, as common wisdom believes, always stabilizing, in the case of non-linear progressive taxation, an...