This paper explores the qualitative and quantitative implications of optimal taxation in a developing economy when economic growth is endogenously determined. We differentiate this class of economies from a developed economy in two aspects: informal sector is quantitatively significant and...

The main aim of this study is to investigate the relationship between public spending on education after the process of decentralization and economic growth in Macedonia as low income state. This paper do not have intention to make a picture of education system in Macedonia, how it functions or...

This paper employs an endogenous growth model to study the growth and welfare effects of the golden rule of public finance. Two versions are compared, whereby government deficits are restricted for the use of public investments. It is shown that the growth effect of the golden rule depends on...

The allocation of resources between education and health is an important and puzzling decision for the governments in countries with high mortality rate. We build a three-period overlapping generation model with mortality risk and show that if public education expenditure exceeds a critical...

I develop a small open endogenous growth model with domestic and foreign intermediate goods. The Marshallian external economies in the domestic intermediate goods sector work as the engine of sustained growth. The model offers two arguments. First, imposing a trade distortion is growth- and...