This paper investigates the efficiency wage hypothesis and derives a tractable expression for the profit loss incurred by deviations from the efficiency wage. The extent of the wage deviation can be inferred from production function parameters. The resulting profit loss shown to depend upon the...

Internet development holds the promise of transmitting economic value across physical space at zero marginal cost. In such a “weightless economy”, what factors matter for the location of economic activity and thus for economic development? This paper sketches a model of spatial dynamics over...

We present detailed empirical evidence that around Greek elections, misgovernance results in significant increases in wildfires and tax evasion and with important economic implications: the cumulative cost of these effects in recent years has been over 8% of GDP and has therefore been a...

We introduce a model of redistributive income taxation and public expenditure. Besides redistributing personal income by means of taxes and transfers, the government supplies goods and services. The government chooses the tax schedule that is found acceptable by the largest share possible of the...