The theoretical linkages between openness and long-run economic growth are established with the development of new growth theories. In this literature, it has been shown that openness affects economic growth through a number of channels and the direction of this effect is closely related to the...

This paper explores the effects of fiscal policy in an economy based on indirect taxes, and taxing all income at the same rate. The focus of the paper is on the relative importance of consumption vs. income taxation, as well as on the provision of valuable public services. To this end, a...

This paper shows a standard RBC model, when augmented with a VAT evasion channel, where evasion depends on the consumption tax rate, can produce a hump-shaped consumption Laffer curve. Furthermore, when the evasion channel is turned off, the hump in the Laffer curve disappears, resulting in a...

I examine if the positive correlation between wealth and survivorship has any implications for the progressivity of Social Security's current benefit-earnings rule. Using a general-equilibrium macroeconomic model calibrated to the U.S. economy, I show that the optimal benefit-earnings link for...

Taxation under oligopoly is analysed in a general equilibrium setting where the firms are large relative to the size of the economy and maximise the utility of their shareholders. It turns out that the model is an aggregative game, which simplifies the comparative statics for the effects of...

In this study a two sector general equilibrium model with fully integrated labour and goods markets is presented. The two labour markets are segmented and represent two different "labour market regimes". The primary sector is an unionized high wage sector with "good" and rationed jobs, in the...