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We study models incorporating money, household production, and investment in housing. Inflation, as a tax on market … activity, encourages substitution into household production, and thus investment in household capital. Hence, inflation … increases the (appropriately deflated) value of the housing stock. This is documented in various data sources. A calibrated …
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We study models incorporating money, household production, and investment in housing. Inflation, as a tax on market … activity, encourages substitution into household production, and thus investment in household capital. Hence, inflation … increases the (appropriately deflated) value of the housing stock. This is documented in various data sources. A calibrated …
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Conventional models of equilibrium unemployment typically imply that proportional taxes on labor earnings are neutral with respect to unemployment as long as the tax does not affect the replacement rate provided by unemployment insurance, i.e., unemployment benefits relative to after-tax...
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