In this paper we analyse the stabilisation properties of distortionary taxes in a New Keynesian model with overlapping generations of finitely-lived consumers. In this framework, government debt is part of net wealth and this adds a number of interesting channels through which fiscal policy could affect output and inflation. Output volatility, in presence of technology shocks, is not substantia...

The present paper is an extension of Ghiglino and Shell [7] to the case of imperfect consumer credit markets. We show that with constraints on individual credit and only anonymous (i.e., non-personalized) lump-sum taxes, strong (or “global”) irrelevance of government budget deficits is not possible, and weak (or “local”) irrelevance can hold only in very special situations. This is in sharp con...

Taxation is known to be the most cost-effective tobacco control measure available to governments throughout the world. Higher tobacco taxes are also referred to as 'win-win' policies because they generate extra government revenue while at the same time reduce long-term tobacco consumption. Many health professionals have therefore been advocating for higher levels of tobacco taxation on public h...

OBJECTIVE To prove that higher cigarette taxes eventually decrease smoking and do also increase state incomes from tobacco taxes by using Hungarian figures. METHOD Collection and analysis of available data on tobacco use, levels of excise and value added taxes on tobacco products and state incomes originating from the tobacco sector. CONCLUSIONS In Hungary, regular tobacco tax increases res...

___________________________________________________________________ A problem facing the United States is financing retirement consumption as its population ages. Policy analysts increasingly advocate savings-for-retirement systems, but are concerned with insufficient savings opportunities with limited government debt. This concern is unwarranted. First, there is more productive capital than co...

We study nonlinear income taxation in a Roy model in which agents’ productivity is sectorspecific. We show that when income taxes can be sector-specific, the Diamond-Mirrlees theorem (according to which the second-best displays production e ciency) fails: social welfare (be it Rawlsian or Weighed Utilitarian) can be increased by assigning some agents to their least productive sector. By sacrifi...

One of the most cogent criticisms of excise taxes is their regressivity, with lower income groups spending a much larger share of their income on goods such as cigarettes than do higher income groups. We argue that traditional quantity-based measures of incidence are only appropriate under a very restrictive ‘‘time-consistent’’ model of consumption of sin goods. A model that is much more consis...

In an effort to reduce the growing prevalence of overweight and obesity, food taxes have been introduced in several European countries, the so-called 'obesitax'. As yet little evidence is at hand, policy measures are being taken to counterweight the consumption of unhealthy food or the increasing diet-related diseases. Several questions need to be discussed, starting from a general perspective:...

The ‘‘green paradox’’ by Hans–Werner Sinn suggests that increasing resource taxes accelerate global warming because resource owners increase near-term extraction in fear of higher future taxation. In this note we show that this effect does only occur for the specific set of carbon taxes that increase at a rate higher than the effective discount rate of the resource owners. We calculate a critic...

In this paper, we develop a modeling and computational framework that allows for the determination of optimal carbon taxes applied to electric power plants in the context of electric power supply chain (generation/distribution/consumption) networks. The adoption of carbon/pollution taxes both internationally and regionally has been fueled by global climate change and fuel security risks with a ...