This paper examines aggregate savings in a general equilibrium model where infinitely lived households face volatile … when income is constant. This additional capital accumulation has sometimes been interpreted as precautionary savings, but … I demonstrate that it is mostly generated by permanent-income motives. -- equilibrium interest rate ; aggregate savings …

Guided by a simple theory of task assignment and time allocation, we investigate the long run response to national … differences in tax rates on labor income, payrolls and consumption. The theory implies that higher tax rates reduce work time in …