In this paper, we examine net investment during the early stages of transition using micro data on the population of medium and large industrial firms in the Czech Republic during the 1992-95 period. We examine the relevance of alternative models of investment and test if investment behavior...

The paper analyzes investment behavior of industrial enterprises in the period immediately following price and foreign trade liberalization in the Czech Republic. It also focuses on the effect of Asoft@ macroeconomic environment on the microeconomic decisions. A dynamic investment function with...

We model the organization of the firm as a type of artificial neural network in a duopoly framework. The firm plays a repeated Prisoner's Dilemma type game, but also must learn to map environmental signals to demand parameters. We study the prospects for cooperation given the need for the firm...

This paper studies the Ramsey problem of optimal labor income taxation in a simple model economy which deviates from a first best representative agent economy in three important aspects, namely, flat rate second best tax, monopoly power in intermediate product market, and monopolistic wage...

This paper provides some further tests for the proposition that a larger public sector leads to smaller output volatility. Both Gali and Fatas & Mihov have provided some evidence which appears to support this proposition. Their evidence is, however, based on a relatively small sample of...

Due to a tax law implemented in 1998, Dutch employers can claim an extra tax deduction when they train employees aged 40 years or older. This causes a discontinuity in a firm's cost of training an employee. We exploit this discontinuity to identify two effects: the effect of the tax deduction on...

This work is focused on identifying the relationship an economic system and its policies have with the environment. The biosphere is chosen in particular as object of analysis but this can be extended by means of an ecosystem recursive properties. The common factor involved in the relationship...

This paper reconsiders the case for the use of fiscal policy based on a "functional finance" approach that advocates the use of fiscal policy to secure high levels of demand in the context of private aggregate demand, which would otherwise be too low. This "functional finance" view means that...

Recent developments in macroeconomic policy, in terms of both theory and practice, have elevated monetary policy while downgrading fiscal policy. Monetary policy has focused on the setting of interest rates as the key policy instrument, along with the adoption of inflation targets and the use of...

This paper studies the welfare properties of distortionary transfers in a life-cycle growth model where natural capital is private property. The main result is that, under credible pre-commitment, each newborn generation prefers positive taxes-subsidies to laissez-faire conditions when the...