Charles T. Carlstrom is an economist at the Federal Reserve Bank of Cleveland, and Timothy S. Fuerst is an associate professor of economics at Bowling Green State University and a visiting scholar at the Bank. The authors would like to thank Larry Christiano and Terry Fitzgerald for helpful comments.

How much fiscal space do Latin American countries have to increase their tax burdens in the long term? This paper provides an answer through Laffer curves estimates for taxes on labor, capital, and consumption six largest emerging economies of region: Argentina, Brazil, Chile, Colombia, Mexico, Peru. Estimates are made using a neoclassical growth model with second-generation human capital emplo...

In Rethinking the Good, Larry Temkin argues for a principle that he calls the Narrow PersonAffecting View. In its simplest formulation, this principle states that a first outcome can be better than a second outcome only if there is someone who fares better in the first outcome than in the second. Temkin argues that this kind of principle gives us reason to reject the Transitivity Thesis, accord...

* I would like to thank Lutz Weinke for calling my attention to a mistake in my previous analysis of this model, Larry Christiano for helpful discussions, and Mauro Roca for research assistance.

In this paper we suggest a behavioral approach to decision making under ambiguity based on the available information. A decision situation is characterized by a set of actions, a set of outcomes, and an information context represented by a data-set containing action-outcome pairs. Decision-makers express preferences over the choice of action in a particular information context. Data-sets contai...

The fall of labor’s share of GDP in the United States and many other countries in recent decades is well documented but its causes remain uncertain. Existing empirical assessments of trends in labor’s share typically have relied on industry or macro data, obscuring heterogeneity among firms. In this paper, we analyze micro panel data from the U.S. Economic Census since 1982 and international so...

In the pre-World-War I period, lacking regulatory restrictions allowed ‘hidden’ mergers; however, some companies disclosed information voluntarily. I analyze insider gains by investigating the share price behavior prior to merger announcements. When companies hid information, stocks exhibited positive abnormal returns prior to newspaper reports that uncovered hidden transactions. My paper was p...