Did the 2008 rebate fail to stimulate consumer spending? In their influential AER articles, John Taylor and Martin Feldstein each claim that BEA aggregate time series data show that the 2008 rebate failed. Re-examining the BEA data, we find that the data instead show there is a high probability...

Is a consumption tax equivalent to a wage tax? This article examines this question in a two-period life-cycle model with Cobb-Douglas production and utility functcons. Three taxes are compared: income, wage, and consumption. The article shows how equivalence depends crucially on government debt...

Abstract Analysts agree that designing a satisfactory tax rule for owner-occupied housingposes a senous challenge for the personal (cash flow) consumption tax that recently has been introduced in Congress by several senators. We compare tax rules for owner-occupied housing by performing...

This article presents an alternative approach to the welfare economics of taxes, and to the choice between an income, wage, and consumption tax. In contrast to standard efficiency analysis of taxes, and to much of the optimal growth literature, the central focus is on the welfare of different...

It is often assumed that if an income tax is converted to a consumption tax, the resulting change in the capital/labor ratio of the economy depends on the saving elasticity (the response of individual saving to the interest rate). In one standard life-cycle growth model, we show that, though...

One criterion for evaluating a nation's military structure is its impact on crisis stability. This article presents a model to capture the process of interacting expectations that determines whether initial suspicions are sufficient to cause one or both nations to strike rather than wait during...