Income Taxation and Growth in an OLG Economy: Does Aggregate Uncertainty Play any Role?

We analyze the effects of capital income taxation on long-run growth in a stochastic, two-period overlapping generations economy. Endogenous growth is driven by a positive externality of physical capital in the production sector that makes firms exhibit an aggregate technology in equilibrium. We distinguish between capital income and labor income, and between attitudes towards risk and intertemporal substitution of consumption. We show necessary and sufficient conditions such that i) increments in the capital income taxation lead to higher equilibrium growth rates, and ii) the effect of changes in the capital income tax rate on the equilibrium growth may be of opposite signs in stochastic and in deterministic economies. Such a sign reversal is shown to be more likely depending on i) how the intertemporal elasticity of substitution compares to one, and ii) the size of second- period labor supply. Numerical simulations show that for reasonable values of the intertemporal elasticity of substitution, a sign reversal shows up only for implausibly high values of the second- period’s labor supply. The conclusion is that deterministic OLG economies are a good approximation of the effect of taxes on the equilibrium growth rate as in Smith (1996).

Optimal Taxation and Indeterminacy in the Uzawa-Lucas Model with Sector-specific Externalities

Documento de trabajo

Does Immigration Raise Natives’ Income? National and Regional Evidence from Spain

How immigration affects the labor market of the host country is a topic of major concern for many immigrant-receiving nations. Spain is no exception following the rapid increase in immigrant flows experienced over the past decade. We assess the impact of immigration on Spanish natives’ income by estimating the net immigration surplus accruing at the national level and at high immigrant-receiving regions while taking into account the imperfect substitutability of immigrant and native labor. Specifically, using information on the occupational densities of immigrants and natives of different skill levels, we develop a mapping of immigrant-to-native self-reported skills that reveals the combination of natives across skills that would be equivalent to an immigrant of a given self-reported skill level, which we use to account for any differences between immigrant self-reported skill levels and their effective skills according to the Spanish labor market. We find that the immigrant surplus amounts to 0.04 percent of GDP at the national level and it is even higher for some of the main immigrant-receiving regions, such as Cataluña, Valencia, Madrid, and Murcia.

Income tax progressivity, growth, income inequality and welfare

This paper analyzes the effects of personal income tax progressivity on long-run economic growth, income inequality and social welfare. The quantitative implications of income tax progressivity increments are illustrated for the US economy under three main headings: individual effects (reduced labor supply and savings, and increased dispersion of tax rates); aggregate effects (lower GDP growth and lower income inequality); and welfare effects (lower dispersion of consumption across individuals and higher leisure levels, but also lower growth of future consumption). The social discount factor proves to be crucial for this third effect: a higher valuation of future generations' well-being requires a lower level of progressivity. Additionally, if tax revenues are used to provide a public good rather than just being discarded, a higher private valuation of such public goods will also call for a lower level of progressivity.

Income risk of EU coal-fired power plants after Kyoto

Coal-fired power plants may enjoy a significant advantage relative to gas plants in terms of cheaper fuel cost. Still, this advantage may erode or even turn into disadvantage depending on CO2 emission allowance price. This price will presumably rise in both the Kyoto Protocol commitment period (2008-2012) and the first post-Kyoto years. Thus, in a carbon-constrained environment, coal plants face financial risks arising in their profit margins, which in turn hinge on their so-called "clean dark spread". These risks are further reinforced when the price of the output electricity is determined by natural gas-fired plants' marginal costs, which differ from coal plants' costs. We aim to assess the risks in coal plants' margins. We adopt parameter values estimated from empirical data. These in turn are derived from natural gas and electricity markets alongside the EU ETS market where emission allowances are traded. Monte Carlo simulation allows to compute the expected value and risk profile of coal-based electricity generation. We focus on the clean dark spread in both time periods under different future scenarios in the allowance market. Specifically, bottom 5% and 10% percentiles are derived. According to our results, certain future paths of the allowance price may impose significant risks on the clean dark spread obtained by coal plants.

La labor del responsable financiero de una empresa

Duración (en horas): De 31 a 40 horas. Nivel educativo: Grado

Labor Market Assimilation of Recent Immigrants in Spain

Revised: 2006-11.-- Published as an article in: British Journal of Industrial Relations, June 2007, vol. 45, issue 2, pp. 257-284.

Immigrants Responsiveness to Labor Market Conditions

Using data from the Spanish Labor Force Survey (Encuesta de Población Activa) from 1999 through 2004, we explore the role of regional employment opportunities in explaining the increasing immigrant flows of recent years despite the limited internal mobility on the part of natives. Subsequently, we investigate the policy question of whether immigration has helped reduced unemployment rate disparities across Spanish regions by attracting immigrant flows to regions offering better employment opportunities. Our results indicate that immigrants choose to reside in regions with larger employment rates and where their probability of finding a job is higher. In particular, and despite some differences depending on their origin, immigrants appear generally more responsive than their native counterparts to a higher likelihood of informal, self, or indefinite employment. More importantly, insofar the vast majority of immigrants locate in regions characterized by higher employment rates, immigration contributes to greasing the wheels of the Spanish labor market by narrowing regional unemployment rate disparities.

Union Formation and Bargaining Rules in the Labor Market

This paper analyzes union formation in a model of bargaining between a firm and several unions. We address two questions: first, the optimal configuration of unions (their number and size) and, second, the impact of the bargaining pattern (simultaneous or sequential). For workers, grouping into several unions works as a price discrimination device which, at the same time, decreases their market power. The analysis shows that optimal union configuration depends on the rules that regulate the bargaining process (monopoly union, Nash bargaining or right to manage).

Growth in Overlapping Generation Economies with Non-Renewable Resources

Published as an article in: Journal of Environmental Economics and Management, 2005, vol. 50, issue 2, pages 387-407.

Optimal Fiscal Policy with Rationing in the Labor Market

Published as an article in: Topics in Macroeconomics, 2005, vol. 5, issue 1, article 17.

Copia de una Carta de Alberto Onaindia a su hermano Domingo en la que el primero informa al último de la labor espiritual realizada en la Prisión del Carmelo de Begoña entre el 25 de julio de 1937 hasta abril de 1938.

Fecha: s.f. (>1970 copia) / Unidad de instalación: Carpeta 45 - Expediente 2-17 / Nº de pág.: 2 (mecanografiadas)

Skill premium effects on fertility and female labor force supply

Published as an article in: Journal of Population Economics, 2004, vol. 17, issue 1, pages 1-16.

An Estimated New-Keynesian Model with Unemployment as Excess Supply of Labor

Wage stickiness is incorporated to a New-Keynesian model with variable capital to drive endogenous unemployment uctuations de ned as the log di¤erence between aggregate labor supply and aggregate labor demand. We estimated such model using Bayesian econometric techniques and quarterly U.S. data. The second-moment statistics of the unemployment rate in the model give a good t to those observed in U.S. data. Our results also show that wage-push shocks, demand shifts and monetary policy shocks are the three major determinants of unemployment fl uctuations. Compared to an estimated New-Keynesian model without unemployment (Smets and Wouters, 2007): wage stickiness is higher, labor supply elasticity is lower, the slope of the New-Keynesian Phillips curve is flatter, and the importance of technology innovations on output variability increases.

La labor del equipo TRACE: metodología descriptiva de la censura en traducción

Raquel Merino Álvarez, José Miguel Santamaría, Eterio Pajares (eds.)