This paper studies the design of sin taxes when firms exercise market power. We outline an optimal tax framework that highlights how market power impacts the efficiency and redistributive properties of sin taxation, and quantify these effects in an application to sugar-sweetened beverage...

Climate change economics mostly neglects sizeable interactions of carbon pricing with other fiscal policy instruments. Conversely, public finance typically overlooks the effects of future decarbonization efforts when devising instruments for the major goals of fiscal policy. We argue that such a...

Can taxes on consumption redistribute in developing countries? Contrary to consensus, we show that taxing consumption is progressive once we account for informal consumption. Using household expenditure surveys in 32 countries we proxy for informal consumption using the type of store where...

We show that some types of fiscal rules can mitigate the well-known procyclical bias in public capital expenditures. Past research has found that fiscal adjustment episodes coincide with large public investment cuts, a pattern we also document in a sample of 75 advanced and emerging economies...

This paper analyzes the implementation of Fiscal Rules (FR) in Argentina. Several clear attempts to establish a FR at the national level are identified. The analysis suggests that the environment matters. The only FR that was binding in the period was approved in 2004 during an economic boom,...

We study the impact of natural resource royalties on educational outcomes in Colombia. We analyze a reform enacted in 2012 that made the distribution of these royalties more equitable. Before the reform, most royalties were assigned to the regions where the natural resources were exploited; with...

Using a large panel of official bilateral loan data for 111 borrowing countries and 78 lending countries between 1980 and 2020, this paper shows that international government borrowing from bilateral sources is acyclical with respect to the economic cycle of the borrower, but procyclical with...

This paper presents a comprehensive framework examining fiscal sustainabil- ity in developing economies. It integrates public capital, labor informality, and global liquidity shocks in a two-sector DSGE model for a small open economy, revealing their intricate interplay and nonlinear impact on...