In this paper we argue that very high marginal labor income tax rates are an effective tool for social insurance even when households have preferences with high labor supply elasticity, make dynamic savings decisions, and policies have general equilibrium effects. To make this point we construct...

In this paper we conduct a quantitative analysis of a number of stylized educational loan systems. We develop a stochastic general equilibrium model of a closed economy with a competitive firm sector and a government that levies taxes and administers educational loans. Individuals are...

As our trading world becomes more globalized, who benefits and who gets hurt? This paper relies on the Ricardian model to explore the effects of technological improvements in underdeveloped countries on the welfare of developed countries. For example, trading between the United States and China,...

As South Africa emerges from its Apartheid period, the evolution of its international trade is vital to the growth of the economy. This paper evaluates South Africa’s trade performance in three essential markets, namely United States, Europe and Japan. It examines the nation’s flexibility in...

This paper shows, using a simple model, that wasteful innovations may result in a loss-loss situation where no country experiences an increase in welfare. If some countries introduce innovations that result in harmful effects on other countries, it may cause the adversely affected countries to...

This paper analyzes the causes and implications of recent financial crises. Financial crises in general lead to changes in both theory and practice of economics. The paper takes an historical overview. The global consensus of economic theory during the 20th century is discussed. The paper...