Our tax system was designed for an economy with little or no inflation. The current paper shows that inflation causes capricious changes in the effective rate of tax on capital income and therefore in the real net rate of return that savers receive. This is not only a temporary disequilibrium...

This paper presents a structural model of production and inventory accumulation based on the hypothesis of cost minimization. It differs from previous attempts in several respects. First, it integrates the analysis of input inventories with output inventories, treating the two stocks separately....

The <i>Journal of Economic Literature</i> regularly reviews books of interest to the economics profession. The 2006 <i>Economic Report of the President (ERP)</i> falls under that purview. In the reviews that follow, Martin Feldstein reviews the overview chapter of the as well as topics relating to...