High unemployment in many European OECD countries has been attributed to factors ranging from rigid wages and low job mobility to an interaction of high taxes and generous social benefits that may discourage labor force participation and encourage the growth of an underground economy. This...

What determines the structure of labour market institutions? This paper argues that common explanations based on rent sharing are incomplete; unions, job protection, and egalitarian pay structures may have as much to do with social insurance of otherwise uninsurable risks as with rent sharing and...

In this paper, we analyze government budget balance within a simple model of endogenous growth. For the AK model, simple analytical conditions for a tax cut to be self-financing can be derived. The critical variable is not the tax rate per se, but the transfer-adjusted tax rate. We discuss some...

In this paper, we analyze government budget balance with a simple model of endogenous growth. For the AK model, simple analyticalconditions for tax cut to be self-financing can be derived. The critical variable is not the tax rate per se, but the "transfer-adjusted" tax rate. We discuss some...