Macroeconomic policies, sector performance and firm response: the case of Chile's textile goods market

Includes bibliography

On inequality tax evasion and progressive taxes

This paper proposes a simple variation of the Allingham and Sandmo (1972) construct and integrates it to a dynamic general equilibrium framework with heterogeneous agents. We study an overlapping generations framework i n which agents must initially decide whether to evade taxes or not. In the event they decide to evade, they then have to decide the extent of income or wealth they wish to under-report. We find that in comparison with the basic approach, the ‘evade or not’ choice drastically reduced the extent of evasion in the economy. This outcome is the result of an anomaly intrinsic to the basic Allingham and Sandmo version of the model, which makes the evade-or-not extension a more suitable approach to modelling the issue. We also find that the basic model, and the model with and ‘evade-or-not’ choice have strikingly different political economy implications, , which suggest fruitful avenues of empirical research.

A review of rationale for allocating costs and payments in producing and supplying public sector information PART A of 2 Parts – Chapters 1, 2 and 3) 13 March 2011 version

This work reviews the rationale and processes for raising revenue and allocating funds to perform information intensive activities that are pertinent to the work of democratic government. ‘Government of the people, by the people, for the people’ expresses an idea that democratic government has no higher authority than the people who agree to be bound by its rules. Democracy depends on continually learning how to develop understandings and agreements that can sustain voting majorities on which democratic law making and collective action depends. The objective expressed in constitutional terms is to deliver ‘peace, order and good government’. Meeting this objective requires a collective intellectual authority that can understand what is possible; and a collective moral authority to understand what ought to happen in practice. Facts of life determine that a society needs to retain its collective competence despite a continual turnover of its membership as people die but life goes on. Retaining this ‘collective competence’ in matters of self-government depends on each new generation: • acquiring a collective knowledge of how to produce goods and services needed to sustain a society and its capacity for self-government; • Learning how to defend society diplomatically and militarily in relation to external forces to prevent overthrow of its self-governing capacity; and • Learning how to defend society against divisive internal forces to preserve the authority of representative legislatures, allow peaceful dispute resolution and maintain social cohesion.

Phoenix activity: Regulatory challenges and the law

Remedying the mischief of phoenix activity is of practical importance. The benefits include continued confidence in our economy, law that inspires best practice among directors, and law that is articulated in a manner such that penalties act as a sufficient deterrent and the regulatory system is able to detect offenders and bring them to account. Any further reforms must accommodate and tolerate legal phoenix activity. Phoenix activity pushes tolerance of entrepreneurial activity to its absolute limits. The wisest approach would be to front end the reforms so as to alleviate the considerable detection and enforcement burden upon regulatory bodies. There is little doubt that breach of the existing law is difficult and expensive to detect; and this is a significant burden when regulators have shrinking budgets and are rapidly losing feet on the ground. This front end approach may need to include restrictions on access to limited liability. The more limited liability is misused, the stronger the argument to limit access to limited liability. This paper proposes that such an approach is a legitimate next step for a robust and mature capitalist economy.

The dilemma of international capital tax competition in the presence of public capital and endogenous growth

Using an OLG-model with endogenous growth and public capital we show, that an international capital tax competition leads to inefficiently low tax rates, and as a consequence to lower welfare levels and growth rates. Each national government has an incentive to reduce the capital income tax rates in its effort to ensure that this policy measure increases the domestic private capital stock, domestic income and domestic economic growth. This effort is justified as long as only one country applies this policy. However, if all countries follow this path then all of them will be made worse off in the long run.

Economics of tourism & growth for small island countries

We theoretically analyze the impact of changes in foreign income from tourism source countries on the growth of tourism dependent small island economies. Using a general theoretical construct, we attempt to answer the question of how price elasticity of demand, income elasticity of tourist and the degree of competition in the service sector influence the economic development of small economies. One of the main results is that politicians may consider applying policies which lead to a competitive environment in the service sector to maximize growth and the consequent labor income share.

Intermediate Macroeconomics : Self-evaluation exercises

This resource can be particularly helpful to students taking the Intermediate Macroeconomics course, which corresponds to the second year of the current Degree in Economics at the University of the Basque Country UPV/ EHU. The precise content of this resource is a collection of eight chapters of multiple-choice questions. For each question the user is asked to guess which the correct answer is. Finally, the tool will return all the correct answers for the whole test, thereby allowing the user to check the validity of his/her answers. A remarkable feature of the tool is that it has been edited in three versions, for the three languages (Spanish, Basque and English) in which the subject is taught at the UPV/EHU.

Re-measuring labor's share

Measuring labor's share of an economy's aggregate income seems straightforward, at least in principle. Count up wage and salary income, along with the value of benefits provided to employees, and divide it by total income. However, one fundamental concept of labor's share in macroeconomic theory is not the amount of aggregate income paid out to labor. Rather, it is the share of aggregate production that is attributable to "raw" units of labor. Or, otherwise stated, it is the share of aggregate income that would have been paid to laborers if they had no accumulated stocks of human capital.1 This share corresponds to an aggregate production function parameter: the elasticity of output with respect to physical (i.e. non-augmented or raw) units of labor (Robert Solow, 1957). In this paper we estimate annual raw labor’s share for the US, 1949 to 1996.

Economía matemática: antecedentes, evolución y algunos desarrollos recientes

Se presenta aquí, en forma breve, el origen de la matematización económica y el campo de la economía matemática. Un enfoque histórico inicial divide dicho campo en un primer periodo denominado marginalista, otro donde se utiliza la teoría de los conjuntos y modelos lineales y por último un periodo que integra los dos anteriores. Posteriormente, se analiza la evolución de la Teoría del Equilibrio General desde Quesnay, pasando por Walras y desarrollos posteriores hasta su culminación con los trabajos de Arrow, Debreu y sus contemporáneos. Finalmente, se describe la influencia de las matemáticas, en especial de la optimización dinámica, en la teoría macroeconómica y a otras áreas de la economía.

Aprendizagem, racionalidade limitada e comportamento econômico

O objetivo desta pesquisa é o de discutir o processo de aprendizagem na teoria econômica, especialmente na macroeconomia; assim como as conseqüências, para a política econômica, de considerar-se tal processo um importante elemento nas decisões econômicas.

Monetary dilemmas: Argentina in MERCOSUR

Includes bibliography

Manual on economic development projects

In this study, projects are not regarded as isolated economic units; they are considered within the context of the entire economic system of which they will form a part. Thus the Manual presents both macroeconomic and microeconomic concepts. From this it must not be inferred that the Manual attempts to offer a combined microeconomic and macroeconomic theory. It seeks to contribute more to an appreciation of the problem than to its solution, thus widening the outlook of those who prepare projects so that they may make the greatest possible compilation of useful data for their economic appraisal.