We wish to study optimal dynamic nonlinear income taxes. Do real world taxes share some of their features? What policy prescriptions can be made? We study a two period model, where the consumers and government each have separate budget constraints in the two periods, so income cannot be...

This paper analyzes the impact of globalization on social spending in Latin America. It shows that trade integration has a consistently negative effect on social security expenditures, and that this effect is compounded by higher integration into capital markets. The importance of political...