Consider an overlapping generation growth model involving identical countries whose fiscal policy reduces to a pay-as-you-go system with flat rate benefits and uniform payroll tax rate. In autarky, the tax rate is chosen so as to achieve a compromise between intragenerational and...

In this paper we discuss the interest of applying differential co-payment rates across alternative medical treatments. Two treatment strategies are considered: a "long term strategy" in which patients apply preventive measures before knowing if they have the desease and an "emergency strategy"...

Using the standard non linear income and commodity taxation framework this paper examines the optimal policy to be adopted when the same labor disutility can receive two opposite interpretations: taste for leisure and activity limitation. In the absence of complete information about individual...

We model long-term care insurance in an optimal taxation framework. Every adult decides upon the amount and type of care he purchases for his dependent parent. We consider two alternatives: nursing-home care provided by the government and home-care paid by the child with some lump-sum subsidy by...

The non-cooperative provision of public goods is analysed in the context of a two-stage game in which club size is determined endogenously. Equilibrium club size and voluntary labour supply are shown to be inefficient. The impact of optimally-chosen fiscal policies using simple instruments is...

This paper considers a federal country composed of local jurisdictions which differ in their taste for public goods and finance public spending by a source-based tax on capital income. The taste for public goods is private information of jurisdictions. By transferring differential grants to...

Despite the fact that all developed economies levy broadly-based indirect taxes alongside direct taxes, little theory is devoted to explaining the direct-indirect tax mix. Our purpose is to show that if different taxes have different evasion characteristics, some optimal tax mix emerges...

Most work on tax competition argues that mobile factors tend to be undertaxed except if there is coordination of tax policies. Full coordination is not however always feasible, and as a consequence some measures of partial coordination have been proposed such as minimal witholding taxes on...

Rochet (1989) showed that with distortionary income taxes, social insurance is a desirable redistributive device when risk and ability are negatively correlated. This finding is reexamined when ex post moral hazard and adverse selection are included, and under different informational...

An overlapping generations model is constructed in which individual wealth is related to educational attainment, and in which liquidity constraints my induce children to invest in a sub-optimal level of education given their ability. Borrowing for educational attainment is obtained from within...