The literature on trade liberalization and environment has not considered federal structures. This paper shows how the design of environmental policy in a federal system has implications for the effects of trade reform. Trade liberalization leads to a decline in pollution taxes regardless of...

This paper studies the equilibrium size of countries. Individuals in small countries have greater influence over the nature of political decision making while individuals in large countries have the advantage of more public goods and lower tax rates. The model implies that (i) there exists...

In this paper I examine the incentives of regions to unite, to separate and to provide public goods. Separation allows for greater influence over the nature of political decision making while unification allows regions to exploit economies of scale in the provision of public goods. When public...

We analyze a simple model of local public good provision in a country consisting of a large number of heterogeneous regions, each comprising two districts, a city and a village. When districts remain autonomous and local public goods have positive spillover effects on the neighboring district,...

This paper analyzes the impact of tax competition between two countries of unequal per-capita capital endownments on tax rates and efficiency when distorting wage, residence-based and source-based capital taxes (or any combination of two instruments) are available for governments. The national...

We provide an analysis of the housing market and current housing policies in three developed countries: the United Kingdom (UK), Switzerland, and the United States (US). We focus on these three countries mainly due to the marked differences in their institutional settings. The UK is...

We study the choice of club membership, when member-countries national governments set their tax policies non-cooperatively. Federal policy (in the form of club membership) has a higher constitutional status than national policies (in the form of income tax rates). This allows federal policy to...

This paper examines how capital tax competition affects jurisdiction formation. We describe a locational model of public goods provision, where jurisdictions are represented by coalitions of consumers with similar tastes, and where the levels of taxation and local public goods provision within...

The high degree of fiscal stress experienced by state governments in the 2001 and the 2007-2009 recessions has prompted renewed discussions of alternative approaches to stabilizing state finances over the business cycle. Prompted by evidence of increased state tax revenue cyclicality in the...

Value Added Tax (VAT) is a type of indirect tax that is imposed on goods and services. In one of the most important reforms of the country’s public finances in over the past 50 years, India has finally launched much delayed Value Added Tax (VAT) from 1st April, 2005 in 21 states. VAT has...