This paper reviews the key economic issues concerning the welfare costs of inflation and deflation, with a view to shedding light on the desirable properties of the inflation process. Our review of the evidence on the overall costs of inflation and deflation indicates that such costs could be...

Wir untersuchen eine Gewinnsteuer in einer unsicheren Welt. Unser Steuersystem erlaubt einen zeitlich veränderlichen Steuersatz, aus diesem Grund wurde auch eine verallgemeinerte Zinskorrektur (ACE) eingeführt. Die Zinskorrektur ist insofern verallgemeinert, da sie einen Anteil des Produktes...

In a recent paper Loeffler/Schneider (2000) showed that introducing a tax on a financial market does not create an arbitrage opportunity...

Economists traditionally tackle normative problems by computing optimal policy, i.e. the one that maximizes a social welfare function. In practice, however, a succession of marginal changes to a limited number of policy instruments are implemented, until no further improvement is feasible. I...

This paper characterizes optimal non-linear income taxation in an economy with a continuum of unobservable productivity levels and endogenous involuntary unemployment due to frictions in the labor markets. Redistributive taxation distorts labor demand and wages. Compared to their efficient...

The purpose of this paper is to present an exercise where we identify optimal income tax rules under the constraint of fixed tax revenue. To this end, we estimate a microeconomic model with 78 parameters that capture heterogeneity in consumption-leisure preferences for singles and couples as...