We extend the protection for sale framework by modelling non tariff barriers. Explicitly introducing partial rent capturing leads to a testable specification that bridges the gap between the theoretical Grossman and Helpman (1994) model and its empirical implementation, where coverage ratios...

We introduce a new, factor based bootstrap approach which is robust under heteroskedastic error terms for inference in functional coefficient models. Modeling the functional coefficient parametrically, the bootstrap approximation of an F statistic is shown to hold asymptotically. In simulation...

In this paper we follow an empirical approach to examine the implications of the Fisher hypothesis, namely cointegration linking interest rates and inflation, and stationarity of the real interest rate implying in turn homogeneity of the potential equilibrium relation. The considered sample is...

What does the saving-investment (SI) relation really measure and how should the (SI) relation be measured? These are two of the most discussed issues triggered by the so called Feldstein-Horioka puzzle. Based on panel data we introduce a new variant of functional coefficient models that allow to...

Based on the observation that industries are often geographically concentrated, this paper proposes a new political economy model of trade protection. We associate the sectors of a specific factors model with electoral districts populated by continua of heterogeneous voters who differ in their...

Amiel et al. (1999) use the Atkinson and the Gini social welfare functions to measure income inequality attitudes based on data from leaky-bucket experiments. Yet the experimental de-sign does not allow their subjects to perceive income inequality according to the Gini or the Atkinson inequality...

Tests of causality in variance in multiple time series have been proposed recently, based on residuals of estimated univariate models. Although such tests are applied frequently little is known about their power properties. In this paper we show that a convenient alternative to residual based...

Leaky-bucket transactions can be regarded as income transfers allowing for transaction costs. In its most rudimentary form, leaky-bucket transactions trace out the maximum "leakage" of transaction costs before income inequality is exacerbated, or before a welfare loss is experienced. This notion...

Deutschland leidet unter einer zu hohen marginalen Abgabenbelastung. Investitionen und Arbeitsplätze wandern in Niedrigsteuerländer und in Länder mit niedrigen Arbeitskosten [das heißt, in Länder mit niedrigen Löhnen und/oder niedrigen lohnbezogenen Abgaben] ab. Im Inland selbst führt die...

This paper analyzes the dynamics of trade policy reform under democracy. In an overlapping generations model, heterogeneous agents may acquire skills when young, thereby determining the skill composition of their cohort. Current and anticipated trade policies influence education decisions, and...