Three Essays on Taxation, Growth and Consumption

The purpose of this dissertation is to examine three distributional issues in macroeconomics. First I explore the effects fiscal federalism on economic growth across regions in China. Using the comprehensive official data set of China for 31 regions from 1952 until 1999, I investigate a number of indicators used by the literature to measure federalism and find robust support for only one such measure: the ratio of local total revenue to local tax revenue. Using a difference-in-difference approach and exploiting the two-year gap in the implementation of a tax reform across different regions of China, I also identify a positive relationship between fiscal federalism and regional economic growth. The second paper hypothesizes that an inequitable distribution of income negatively affects the rule of law in resource-rich economies and provides robust evidence in support of this hypothesis. By investigating a data set that contains 193 countries and using econometric methodologies such as the fixed effects estimator and the generalized method of moments estimator, I find that resource-abundance improves the quality of institutions, as long as income and wealth disparity remains below a certain threshold. When inequality moves beyond this threshold, the positive effects of the resource-abundance level on institutions diminish quickly and turn negative eventually. This paper, thus, provides robust evidence about the endogeneity of institutions and the role income and wealth inequality plays in the determination of long-run growth rates. The third paper sets up a dynamic general equilibrium model with heterogeneous agents to investigate the causal channels which run from a concern for international status to long-run economic growth. The simulation results show that the initial distribution of income and wealth play an important role in whether agents gain or lose from globalization.

Behavioral Response to Environmental Taxation: Evidence from the Transportation Sector

This dissertation analyzes how individuals respond to the introduction of taxation aimed to reduce vehicle pollution, greenhouse gases and traffic. The first chapter analyzes a vehicle registration tax based on emissions of carbon dioxide (CO2), a major greenhouse gas, adopted in the UK in 2001 and subject to major changes in the following years. I identify the impact of the policy on new vehicle registrations and carbon emissions, compared to alternative measures. Results show that consumers respond to the tax by purchasing cleaner cars, but a carbon tax generating the same revenue would further reduce carbon emissions. The second chapter looks at a pollution charge (polluting vehicles pay to enter the city) and a congestion charge (all vehicles pay) adopted in 2008 and 2011 in Milan, Italy, and how they affected the concentration of nitrogen dioxides (NOx). I use data from pollution monitoring stations to measure the change between areas adopting the tax and other areas. Results show that in the first quarter of their introduction, both policies decreased NOx concentration in a range of -8% and -5%, but the effect declines over time, especially in the case of the pollution charge. The third chapter examines a trial conducted in 2005 in the Seattle, WA, area, in which vehicle trips by 276 volunteer households were recorded with a GPS device installed in their vehicles. Households received a monetary endowment which they used to pay a toll for each mile traveled: the toll varied with the time of the day, the day of the week and the type of road used. Using information on driving behavior, I show that in the first week a $0.10 toll per mile reduces the number of miles driven by around 7%, but the effect lasts only few weeks at most. The effect is mainly driven by a reduction in highway miles during trips from work to home, and it is strongly influenced by past driving behavior, income, the size of the initial endowment and the number of children in the household.

Work/Family Balance: HRM Policy and Practice in Australia

An employee's inability to balance work and family responsibilities has resulted in an increase in stress related illnesses. Historically, research into the nexus between work and family has primarily focused on the work/family conflict relationship, predominately investigating the impact of this conflict on parents, usually mothers. To date research has not sufficiently examined the human resource management practices that enable all parents to achieve a balance between their work and family lives. This paper explores the relationship between contemporary family friendly HRM policies and employed parents perceptions of work/family enhancement, work/family satisfaction, propensity to turnover, and work/family conflict. Self-report questionnaire data from 326 men and women is analysed and discussed to enable organisations to consider the use of family friendly policies and thus create a convergence between the well-being of employees and the effectiveness of the organisation.