scholarly journals The optimal taxation of savings and investment in an open economy

1995 ◽  
Vol 47 (1) ◽  
pp. 59-62 ◽  
Author(s):  
Harry Huizinga
Keyword(s):  
Open Economy ◽  
Optimal Taxation

Ramsey income taxation in a small open economy with trade in capital goods

2019 ◽  
Vol 20 (1) ◽  
Author(s):  
Jenn-Hong Tang
Keyword(s):  
Open Economy ◽  
Income Tax ◽  
Optimal Taxation ◽  
Small Open Economy ◽  
Labor Income ◽  
Closed Economy ◽  
Capital Income ◽  
Long Run ◽  
Optimal Capital ◽  
Investment Goods

Abstract In this paper, the optimal taxation problem in a small open economy with international trade in capital or investment goods is investigated. The monopolistic power of a small open economy over the terms of trade causes distortions in consumption and investment. The results suggest that due to the external distortion in investment, the long-run optimal capital income tax could be positive under the baseline calibration, and it is increasing in the degree of investment openness and decreasing in the elasticity of substitution between domestic and foreign goods. The long-run optimal labor income tax exhibits the opposite relationships with the openness and elasticity parameters. During the course of business cycles, the fluctuations in the external distortions cause the optimal labor income tax to be more volatile and the optimal capital income tax to be less volatile than their closed-economy counterparts.

scholarly journals Social Comparisons and Optimal Taxation in a Small Open Economy

2019 ◽  
Vol 121 (4) ◽  
pp. 1500-1532
Author(s):  
Thomas Aronsson ◽  
Olof Johansson‐Stenman ◽  
Tomas Sjögren
Keyword(s):  
Open Economy ◽  
Optimal Taxation ◽  
Small Open Economy ◽  
Social Comparisons

Optimal taxation and debt in an open economy

1992 ◽  
Vol 47 (1) ◽  
pp. 27-57 ◽  
Author(s):  
James E. Anderson ◽  
Leslie Young
Keyword(s):  
Open Economy ◽  
Optimal Taxation

SHOULD THE PRIVATE SECTOR PROVIDE PUBLIC CAPITAL?

2007 ◽  
Vol 11 (3) ◽  
pp. 318-346
Author(s):  
SANTANU CHATTERJEE
Keyword(s):  
Open Economy ◽  
Public Capital ◽  
Borrowing Constraints ◽  
International Capital ◽  
Standard Assumption ◽  
Production Externalities ◽  
International Capital Markets ◽  
Private Provision ◽  
Large Production ◽  
Government Provision

The choice between private and government provision of a productive public good like infrastructure (public capital) is examined in the context of an endogenously growing open economy. The accumulation of public capital need not require government provision, in contrast to the standard assumption in the literature. Even with an efficient government, the relative costs and benefits of government and private provision depend crucially on the economy's underlying structural conditions and borrowing constraints in international capital markets. Countries with limited substitution possibilities and large production externalities may benefit from governments encouraging private provision of public capital through targeted investment subsidies. By contrast, countries with flexible substitution possibilities and relatively smaller externalities may benefit either from governments directly providing public capital or from regulation of private providers. The transitional dynamics also are shown to depend on the underlying elasticity of substitution and the size of the production externality.

The long-run stability of a small, open economy under crawling peg regime

2002 ◽  
Vol 52 (1) ◽  
pp. 57-78
Author(s):  
S. Çiftçioğlu
Keyword(s):  
Exchange Rate ◽  
Open Economy ◽  
Risk Premium ◽  
Small Open Economy ◽  
Exchange Rate Policy ◽  
Price Stability ◽  
Output Stability ◽  
Long Run ◽  
The Exchange Rate ◽  
The Impact

The paper analyses the long-run (steady-state) output and price stability of a small, open economy which adopts a “crawling-peg” type of exchange-rate regime in the presence of various kinds of random shocks. Analytical and simulation results suggest that with the exception of money demand shocks, an exchange rate policy which involves a relatively higher rate of indexation of the exchange rate to price level is likely to lead to the worsening of price stability for all types of shocks. On the other hand, the impact of adopting such a policy on output stability depends on the type of the shock; for policy shocks to the exchange rate and shocks to output demand, output stability is worsened whereas for the shocks to risk premium of domestic assets, supply price of domestic output and the wage rate, better output stability is achieved in the long run.

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