Bad policies (i.e., policies harmful to private producers such as excessive taxation, arbitrary confiscation, and negligence of pubic goods) are observed in quite a few countries. These countries tend to have autocratic regimes.I explore a reason why bad policies may benefit autocrats.I present...

This paper studies the design of tax systems that implement a planner's second-best allocation in a market economy. An example shows that the widely used Mirrleesian (1976) tax system cannot implement all incentive-compatible allocations. Hammond's (1979) "principle of taxation" proves that any...

This paper is concerned with a policy oriented macroeconomic experiment involving an 'international' economy with a relatively small 'home' country and a large 'foreign' country. It compares the economic performance of two alternative tax systems as a means to finance unemployment benefits: a...

This discussion paper led to a publication in <A href="http://www.sciencedirect.com/science/article/pii/S0014292111000912">'European Economic Review'</A>, 56(2) 216-32.<P>This paper is concerned with a policy oriented macroeconomic experiment involving an 'international' economy with a relatively small 'home' country and a large 'foreign' country. It compares the economic...</p></a>

Tax Burden, defined as the ratio of total tax revenues over personal income, is prominently used to summarize state tax policy. We analyze the empirical relationship between changes in Tax Burden and changes in state tax policy from 1987 to 2000 – as measured by states’ own forecasts of the...

We consider equilibrium and optimum use of a Vickrey road bottleneck, distinguishing between long-run and short-run scheduling preferences in an otherwise stylized scheduling model. The preference structure reflects that there is a distinction between the (exogenous) 'long-run preferred arrival...

The European Commission favours the introduction of a consolidated corporate tax base to overcome the distortions arising from the existing system of separate accounting. The blueprints for consolidation are simulated with the applied general equilibrium model CORTAX. We show that the benefits...

This paper investigates optimal airport pricing when airlines provide imperfect substitutes products, and make decisions on capacity, scheduling and pricing. We show that the first-best toll per flight may be higher than the simple market-shares formulae that were recently derived for Cournot...

The European Commission favours the introduction of a consolidated corporate tax base to overcome the distortions arising from the existing system of separate accounting. The blueprints for consolidation are simulated with the applied general equilibrium model CORTAX. We show that the benefits...

We apply theories of capital market failure to ana1yze