This study suggests a two-step approach to identifying and interpreting regional convergence clubs in Europe. The first step calculates Bayesian probabilities for various assignments of regions to two clubs using a general stochastic space-time dynamic panel relationship between growth rates and initial levels of income as well as endowments of physical, knowledge and human capital. This approa...

This study examines how variations in states’ corporate income tax regimes affect new capital investment by business. Using U.S. state-aggregated data from 1983 to 1996, we find in pooled and fixed-effects regressions that new capital expenditures by corporations in the manufacturing sector are decreasing in the income tax burden on property (measured as the product of the statutory tax rate an...

Our objective is to investigate, how the combination of habit formation with endogenous capital utilization decisions affects the process of economic growth. We find that in the presence of positive productivity growth, habit formation in consumption reduces the rate of capital utilization while increasing the long run stock of capital. We show in the Chamley–Judd result of zero income capital ...

This article shows that investors financing a portfolio of projects may use the depth of their financial pockets to overcome entrepreneurial incentive problems. Competition for scarce informed capital at the refinancing stage strengthens investors’ bargaining positions. And yet, entrepreneurs’ incentives may be improved, because projects funded by investors with ‘‘shallow pockets’’ must have no...

There is a strong case for arguing that, in contradiction to some traditional arguments in public economics, capital income should be taxed, though not necessarily under the same rate schedule as labour earnings. The Dual Income Taxation (DIT) system consists of two parallel piecewise linear tax schedules, in which that for capital income has a zero lower bracket rate and an upper bracket rate ...

An aspect of life history that has seen increasing attention in recent years is that of strategies for financing the costs of offspring production. These strategies are often described by a continuum ranging from capital breeding, in which costs are met purely from endogenous reserves, to income breeding, in which costs are met purely from concurrent intake. A variety of factors that might driv...

Tax-based deficit reduction experiments for the U.S. and EMU-12 are conducted using an open economy model. In welfare terms, raising the consumption tax is the least costly, followed by the labor income tax, then the capital income tax. Use of an open economy model means that the incidence of the consumption tax is borne in part by foreign producers. Among revenue-neutral tax experiments, parti...

OBJECTIVES We examined relationships between social capital and health service measures among low-income individuals and assessed the psychometric properties of a theory-based measure of social capital. METHODS We conducted a statewide telephone survey of 1216 low-income New Mexico residents. Respondents reported on barriers to health care access, use of health care services, satisfaction wit...

This paper begins by examining the pattern of capital flows first to low-income countries, and then to emerging economies. In both cases, we see a dramatic collapse in the last several years. The evolving determinants of these trends in FDI flows (the principal category of private flows to low-income countries) and other capital flows are analysed. The behaviour of flows to emerging economies h...