This paper deals with the solution to vertical expenditure externalities in a federation with two levels of government sharing taxes. Under these circumstances, the Nash equilibrium does not satisfy the condition for production efficiency in the provision of public inputs. This vertical...

This paper examines optimal policies on taxation and user fees in a model where government spending is productive, rival, and congestive, and can be further classified as excludable and nonexcludable public inputs. We propose functions for the services of excludable and nonexcludable public...

The local business tax as the main revenue source of local governments in Germany has been under extensive debate for decades. Proposals for reform range from a pure profit tax to an origin-based value-added tax. Local business taxation systems in OECD countries actually represent the whole...

This paper examines the growth effects of an increase of capital income taxes if the additional revenue is devoted to cutting wage-related social security contributions to reduce unemployment. The analysis is carried out in an overlapping-generations model with endogenous growth, unemployment,...

This paper analyzes the consequences of international capital mobility for national social-transfer policy and unemployment in a model with workers of different skill and income levels. Social transfers may cause unemployment of low-skilled workers if the transfer level exceeds their potential...

To determine the welfare effects of tax coordination, it is often assumed that one tax is jointly increased and all other policy instruments are held constant. This paper, in contrast, analyzes partial coordination in the sense that each country can still adjust another tax, which is not subject...