Economic policy is generally directed to achieve particular objectives which include targets for inflation, desirable unemployment levels, economic growth pace, standard of living of citizens among others. An economic policy is a course of action that is intended to influence or control the...

This paper proposes a theory of regulation by constructing a pseudo production function in the general equilibrium model. The theory shows that the first-best social optimum can be achieved in imperfect markets while free entry and the independent choice of price and output are retained. Three...

This paper proposes a break-even tax-subsidy scheme designed with an entry tax and a production subsidy to regulate imperfect competition. The first-best social optimum incorporating marginal cost pricing, minimum-average-cost output, and socially optimal number of firms is achieved. In the...

This paper provides a tractable equilibrium model with firm heterogeneity to show a new kind of market failure. In the model, resources are excessively skewed toward the products with lower fixed costs of production, thus there exists both excessive entry in products with low fixed costs and...

The proposal involves the establishment of 'welfare accounts' for every person in a country. There are to be four accounts: a retirement account (covering pensions), an unemployment account (covering unemployment support), a human capital account (covering education and training), and a health...

Are market and voting institutions capable of producing optimal intergenerational risk-sharing? To study this question we consider a simple endowment economy with uncertainty and overlapping generations. Endowments are stochastic; thus it is possible to increase the welfare of every generation...

This paper makes the argument that certain public goods (those lacking special interest backing) are likely to be under-provided by governments. Moreover, some such goods are complementary with private goods (e.g. roads and automobiles), while other such goods are substitutes for private goods...

We study the optimal Mirrlees taxation problem in a dynamic economy with idiosyncratic (productivity or preference) shocks. In contrast to the standard approach, which implicitly assumes that the mechanism is operated by a benevolent planner with full commitment power, we assume that any...

The role of foreign aid in the growth process of developing countries has been a topic of intense debate. Foreign aid is an important topic given its implications for poverty reduction in developing countries.Since the second World War, foreign aid has been one of the most prominent policy tools...

This paper adopts a strategic management approach (objectives, strategy, structure, control) to the study of the European Union's taxation problems. Union of States have some strengths vis-à-vis individual States. However, to ensure that all States benefit, they need constant redistribution. As...