According to Kim and Lee (1997), property taxes as opposed to capital gain taxes and taxes on rent endanger dynamic efficiency. The present paper shows that the choice of the tax base is immaterial. What counts is whether the taxes eliminate the after-tax rent. Empirical evidence suggests that...

Since Thaler (1981), we have lived with the uncomfortable stylized fact that many humans choose strictly dominated actions in intertemporal choice experiments. We designed an experiment to probe the reasons for the apparently suboptimal behavior, and we find that the classic Fisher (1930)...

We use a multiple price list approach with real payments to elicit long-term time preferences on a sample of French farmers. Elicited individual discount rates vary with the time delay, which supports the existence of a reversal effect in long-term time preferences, and increase with rewards,...

This paper investigates the relationship between economic growth and a fully funded social security system in an overlapping generations model with family altruism. It is shown that funded social security may harm growth if there are operative bequests within the family.

We consider procedures that use randomness to make a decision that involves several individuals. We asked subjects to compare the fairness of six pairs of seemingly equivalent procedures. We propose a classification of subjects into two categories: those who are “emotional” in the sense...

We study exchanges between three overlapping generations with non-dynastic altruism. The middleaged choose informal care provided to their parents and education expenditures for their children. The young enjoy their education, while the old may leave a bequest to their children. Within each...

We adjust current account surpluses and deficits of 57 countries in the period 2005–2009 for differences in the age structure of their populations and find that these differences can account for a significant part of the variation in the data. Among the large countries we find that the...

We develop and characterize analytically an investment model in discrete time with a fixed adjustment cost not proportional to existing capital and complete irreversibility that reproduces the lumpiness of investment at the micro-level. In agreement with the empirical evidence, as a firm size...

We find that lottery tax windfalls finance higher state-government expenditures on supplemental security income that increase consumption, but only during bust periods. Wealth transfers from lottery winners to low income households enable fiscal policy to stabilize consumption during bust periods.

Consumption falls counter-factually on impact for investment-specific technology shocks, which, recent literature suggests, are important drivers of business cycles. Introducing financial frictions and variable capacity utilization to the standard New-Keynesian setup can overturn this...