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The paper addresses three issues related to Tiebout-type equilibrium: (a) Is the property tax a second-best instrument? (b) Given the feasible instrument menu, is a Tiebout-type allocation with profit-maximizing suppliers of the LPG constrained efficient? (c) Given the ranking of instruments,...
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Recent studies find wage subsidies (WS) to be superior to negative income tax (NIT). However, these studies suffer from a serious aggregation problem. A model is suggested in which these aggregation problems are avoided. In this model there exists a WS schedule that increases labor supply...
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