Taxes in Our Model: Take 2

2020 ◽  
pp. 163-177
Author(s):  
Harold L. Cole
Keyword(s):  
Steady State ◽  
Income Distribution ◽  
Growth Path ◽  
Heterogeneous Agent ◽  
Agent Model ◽  
Balanced Growth ◽  
Heterogeneous Agent Model ◽  
Distributional Consequences ◽  
Balanced Growth Path ◽  
The U.S

Our first and only heterogeneous agent model is constructed with two types. The steady state balanced growth path is developed, the model is calibrated to the U.S. income distribution and implications of reducing capital taxes are re-examined once distributional consequences are considered.

scholarly journals CAN EDUCATION BE GOOD FOR BOTH GROWTH AND THE ENVIRONMENT?

2013 ◽  
Vol 17 (5) ◽  
pp. 1135-1157 ◽  
Author(s):  
Fabien Prieur ◽  
Thierry Bréchet
Keyword(s):  
Public Policy ◽  
Steady State ◽  
Overlapping Generations ◽  
Environmental Awareness ◽  
Sustainable Growth ◽  
Growth Path ◽  
Overlapping Generations Model ◽  
Balanced Growth ◽  
Knowledge Growth ◽  
Balanced Growth Path

We develop an overlapping-generations model of growth and the environment in relation to public policy on education. Beyond the traditional mechanisms through which knowledge, growth, and the environment interplay, we stress the role played by education in environmental awareness. Assuming first that environmental awareness is constant, we show the existence of a balanced-growth path (BGP) along which environmental quality increases continually. Then, if education enhances environmental awareness, the equilibrium properties are modified: the economy can reach a steady state or converge to an asymptotic BGP. Therefore, education does not necessarily promote sustained and sustainable growth.

Distribution and Endogenous Growth: The Two-Class Pasinetti Model / Verteilung und endogenes Wachstum: Das Zwei-Klassen Modell von Pasinetti

2001 ◽  
Vol 221 (3) ◽  
Author(s):  
Alfred Greiner
Keyword(s):  
Growth Rate ◽  
Income Distribution ◽  
Saddle Point ◽  
Endogenous Growth ◽  
Growth Path ◽  
Balanced Growth ◽  
Positive Externalities ◽  
Balanced Growth Path ◽  
Per Capita

SummaryThe paper extends the two-class Pasinetti model with workers and capitalists to allow for endogenous growth. Sustained per-capita growth results from positive externalities of investment which for its part only occur if workers devote time to education so that an efficient use of new machines is guaranteed. It is shown that there exists a unique balanced growth path which is a saddle point. The effects of raising education on the growth rate as well as on the income distribution between workers and capitalists are studied as well. It is demonstrated that education affects the balanced growth rate and, thus, the income of workers. However, it does not affect the ratio of workers’ income relative to the income of capitalists.

scholarly journals Golden-Rule Level of the Employment

2017 ◽  
Vol 01 (01) ◽  
pp. 1740005 ◽  
Author(s):  
Yong Tao ◽  
Xiangjun Wu
Keyword(s):  
Production Function ◽  
Golden Rule ◽  
Perfect Competition ◽  
Growth Path ◽  
Aggregate Production ◽  
Balanced Growth ◽  
Aggregate Production Function ◽  
Long Time ◽  
Balanced Growth Path ◽  
General Equilibria

The competitive economy, over a long time scale, would produce a large number of general equilibria, each of which can be regarded as a possible microstate of this economy. Then by the principle of maximum entropy, we can obtain the most probable macrostate which in the case of perfect competition involving a single industry will lead to a Solow-type aggregate production function. By this aggregate production function, one can make clear how labors match firms on the balanced growth path. Here, we prove that when the capital stock of a society arrives at the golden-rule level on the balanced growth path, the social employment will reach the best level at which every firm on average employs an optimal amount of workers.

scholarly journals Risk premiums and macroeconomic dynamics in a heterogeneous agent model

2010 ◽  
Vol 34 (9) ◽  
pp. 1680-1699 ◽  
Author(s):  
Ferre De Graeve ◽  
Maarten Dossche ◽  
Marina Emiris ◽  
Henri Sneessens ◽  
Raf Wouters
Keyword(s):  
Macroeconomic Dynamics ◽  
Heterogeneous Agent ◽  
Risk Premiums ◽  
Agent Model ◽  
Heterogeneous Agent Model

scholarly journals GENERAL EQUILIBRIUM FEEDBACK REGARDING THE EMPLOYMENT EFFECTS OF LABOR TAXES

2019 ◽  
Vol 24 (8) ◽  
pp. 2012-2032
Author(s):  
Minchul Yum
Keyword(s):  
Interest Rate ◽  
General Equilibrium ◽  
Labor Supply ◽  
Real Interest Rate ◽  
Heterogeneous Agent ◽  
Agent Model ◽  
Heterogeneous Agent Model ◽  
Labor Tax ◽  
Labor Taxes ◽  
Tax Changes

A higher labor tax rate increases the equilibrium real interest rate and reduces the equilibrium wage in a heterogeneous-agent model with endogenous savings and indivisible labor supply decisions. I show that these general equilibrium (GE) adjustments, in particular of the real interest rate, reinforce the negative employment impact of higher labor taxes. However, the representative-agent version of the model, which generates similar aggregate employment responses to labor tax changes, implies that GE feedback is neutral. The cross-country panel data reveal that the negative association between labor tax rates and the extensive margin labor supply is significantly and robustly weaker in small open economies where the interest rate is less tightly linked to domestic circumstances. This empirical evidence supports the transmission mechanism of labor tax changes for employment in the heterogeneous-agent model.

scholarly journals Risk Premiums and Macroeconomic Dynamics in a Heterogeneous Agent Model

2009 ◽  
Author(s):  
Ferre De Graeve ◽  
Maarten Dossche ◽  
Marina Emiris ◽  
Henri R. Sneessens ◽  
Rafael Wouters
Keyword(s):  
Macroeconomic Dynamics ◽  
Heterogeneous Agent ◽  
Risk Premiums ◽  
Agent Model ◽  
Heterogeneous Agent Model
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