The principal aim of our paper is to provide a primer on the foundations of the theory of intergovernmental grants, suitable for newcomers to this active field of research. In addition, we provide a selective survey of recent theoretical papers on grants, focusing particularly on non-cooperative...

In this paper we examine the optimal taxation of corporate profits in a multi-period limit pricing model where a dominant firm faces expansion by a competitive fringe. The optimal policy requires tax rates to vary both intertemporally and across firm sizes, and balances the benefit of fringe...

We develop a general equilibrium model of crime in which honest workers face an effective tax rate on earnings, consisting of an exogenous income tax, used to pay for policing, and an endogenous crime tax, given by the proportion of their disposable income that is stolen. When there are two...

We consider an R&D-driven endogenous growth model in which innovation is risky and agents are risk averse. Growth is determined by the occupational choice of agents who can either work in production for a wage or become entrepreneurs. In this context, we examine the impact of redistributive...