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The jointly optimal inflation tax, income tax structure, and transfers

Miller, Preston J. - Federal Reserve Bank of Minneapolis - 1995

The welfare-maximizing income tax structure, rate of money creation, and amounts of intergenerational transfers are jointly determined for given rates of government consumption. When government consumption is zero, it is found for the parameter values examined that the income tax structure is...

Persistent link: https://www.econbiz.de/10005367635

A contribution to the theory of pork barrel spending

Chari, V.V.; Cole, Harold - Federal Reserve Bank of Minneapolis - 1993

In this paper we present a formal model of vote trading within a legislature. The model captures the conventional wisdom that if projects with concentrated benefits are financed by universal taxation, then majority rule leads to excessive spending. This occurs because the proponent of a...

Persistent link: https://www.econbiz.de/10005498534

Why are representative democracies fiscally irresponsible?

Chari, V.V.; Cole, Harold - Federal Reserve Bank of Minneapolis - 1993

goods expenditures and how they are financed. In our model of the political process legislators defer to spending requests …

Persistent link: https://www.econbiz.de/10005498586

A business cycle model with nominal wage contracts and government

Cho, Jang-Ok; Phaneuf, Louis - Federal Reserve Bank of Minneapolis - 1993

We incorporate nominal wage contracts and government into a quantitative general equilibrium framework. Thus, our model includes three types of shocks: a fiscal shock, a monetary shock, and a technology shock. We show that it is possible in this type of environment to generate a low correlation...

Persistent link: https://www.econbiz.de/10005372795

The output, employment, and interest rate effects of government consumption

Aiyagari, S. Rao; Christiano, Lawrence J.; Eichenbaum, … - Federal Reserve Bank of Minneapolis - 1990

This paper investigates the impact of aggregate variables of changes in government consumption in the context of a stochastic, neoclassical growth model. We show, theoretically, that the impact on output and employment of a persistent change in government consumption exceeds that of a temporary...

Persistent link: https://www.econbiz.de/10005372802

Unequal we stand: an empirical analysis of economic inequality in the United States, 1967-2006

Heathcote, Jonathan; Perri, Fabrizio; Violante, Giovanni L. - Federal Reserve Bank of Minneapolis - 2009

earnings, to disposable income, and, ultimately, to consumption and wealth. We document a continuous and sizable increase in …

Persistent link: https://www.econbiz.de/10008610994

A parsimonious macroeconomic model for asset pricing

Guvenen, Fatih - Federal Reserve Bank of Minneapolis - 2009

wealth held by non-stockholders in the US data, which has proved problematic for previous models with limited participation …. I show that this large wealth inequality is also important for the model's ability to generate a countercyclical equity …

Persistent link: https://www.econbiz.de/10004967523

Class systems and the enforcement of social norms

Cole, Harold L.; Mailath, George J.; Postlewaite, Andrew - Federal Reserve Bank of Minneapolis - 1996

We analyze a model in which there is socially inefficient competition among people. In this model, self-enforcing social norms can potentially control the inefficient competition. However, the inefficient behavior often cannot be suppressed in equilibrium among those with the lowest income due...

Persistent link: https://www.econbiz.de/10005367743

Real effects of inflation through the redistribution of nominal wealth

Doepke, Matthias; Schneider, Martin - Federal Reserve Bank of Minneapolis - 2005

This paper provides a quantitative assessment of the effects of inflation through changes in the value of nominal assets. We document nominal positions in the U.S. across sectors as well as different groups of households, and estimate the redistribution brought about by a moderate inflation...

Persistent link: https://www.econbiz.de/10005367749

Wealth inequality and intergenerational links

Nardi, Mariacristina De - Federal Reserve Bank of Minneapolis - 2002

Previous work has had difficulty generating household saving behavior that makes the distribution of wealth much more … concentrated than that of labor earnings, and that makes the richest households hold onto large amounts of wealth, even during very … wealth concentration even more. I also show that the introduction of a bequest motive generates lifetime savings profiles …

Persistent link: https://www.econbiz.de/10005367764