Balanced-Budget Rules and Aggregate Instability: The Role of Consumption Taxes in a Monetary Economy

2013 ◽  
Author(s):  
Jianpo XUE ◽  
Chong Kee Yip
Keyword(s):  
Monetary Economy ◽  
Balanced Budget ◽  
Consumption Taxes

The Role of credit in a Keynesian monetary economy

2005 ◽  
Vol 17 (4) ◽  
pp. 489-511 ◽  
Author(s):  
Giancarlo Bertocco
Keyword(s):  
Monetary Economy

scholarly journals Welfare optimization and multinational monopolies

1996 ◽  
Vol 38 (1) ◽  
pp. 16-25
Author(s):  
A. M. Russell ◽  
C. A. Martini ◽  
J. A. Rickard
Keyword(s):  
Parameter Space ◽  
Home Country ◽  
Domestic Market ◽  
Consumption Tax ◽  
Optimal Value ◽  
National Welfare ◽  
Consumption Taxes

AbstractThis paper examines the role of import tariffs and consumption taxes when a product is supplied to a domestic market by a foreign monopoly via a subsidiary. It is assumed that there is no competition in the domestic market from internal suppliers. The home country is able to levy a profits tax on the subsidiary. The objective of our analysis is to determine the mix of tariff and consumption tax which simultaneously maximizes national welfare. We show that national welfare does not have an internal maximum, but attains its maximum on a boundary of the consumption tax–tariff parameter space. Furthermore, the optimal value of national welfare increases as the tariff decreases and the consumption tax increases. The results obtained generalize the results of an earlier paper in which national welfare was maximized with respect to either a tariff or consumption tax, but not both.

scholarly journals Destabilizing balanced-budget consumption taxes in multi-sector economies

2013 ◽  
Vol 9 (1) ◽  
pp. 113-130 ◽  
Author(s):  
Kazuo Nishimura ◽  
Carine Nourry ◽  
Thomas Seegmuller ◽  
Alain Venditti
Keyword(s):  
Balanced Budget ◽  
Consumption Taxes

scholarly journals NONSEPARABLE PREFERENCES DO NOT RULE OUT AGGREGATE INSTABILITY UNDER BALANCED-BUDGET RULES: A NOTE

2016 ◽  
Vol 21 (1) ◽  
pp. 259-277 ◽  
Author(s):  
Nicolas Abad ◽  
Thomas Seegmuller ◽  
Alain Venditti
Keyword(s):  
Labor Income ◽  
Tax Rates ◽  
Neoclassical Growth Model ◽  
Elasticity Of Intertemporal Substitution ◽  
Nonseparable Utility ◽  
Nonseparable Preferences ◽  
Balanced Budget ◽  
Neoclassical Growth ◽  
Rule Out

We investigate the role of nonseparable preferences in the occurrence of macroeconomic instability under a balanced-budget rule where government spending is financed by a tax on labor income. Considering a one-sector neoclassical growth model with a large class of nonseparable utility functions, we find that expectations-driven fluctuations occur easily when consumption and labor are Edgeworth substitutes or weak Edgeworth complements. Under these assumptions, an intermediate range of tax rates and a sufficiently low elasticity of intertemporal substitution in consumption lead to instability.

scholarly journals Welfare policy and multi-national monopolies

1992 ◽  
Vol 34 (2) ◽  
pp. 133-152 ◽  
Author(s):  
John Rickard ◽  
Allen Russell ◽  
Christine Martini
Keyword(s):  
Policy Implication ◽  
Home Country ◽  
Welfare Policy ◽  
Critical Value ◽  
Domestic Market ◽  
Consumption Tax ◽  
National Welfare ◽  
Effective Instrument ◽  
Consumption Taxes

AbstractThis paper examines the role of import tariffs and consumption taxes when a product is supplied to a domestic market by a foreign monopoly via a subsidiary. It is assumed that there is no competition in the domestic market from internal suppliers. The home country is able to levy a profits tax on the subsidiary; the objective of our analysis is to determine the levels of tariff or consumption tax which maximise national welfare. Comparisons are made under the two alternative policies from the perspectives of national welfare, total national cost and average national cost. The major policy implication of the analysis is that a consumption tax is the more effective instrument for maximising national welfare provided the profits tax is less than a certain critical value; if the profits tax exceeds this value then a tariff, though in the form of a subsidy, is the most effective instrument. Our results complement, correct and extend an earlier analysis by Katrak (1977) [6].

THE ROLE OF CONSUMPTION TAXES IN TAX REFORM AROUND THE WORLD

1988 ◽  
Vol 41 (3) ◽  
pp. 357-364
Author(s):  
HARRY D. GARBER
Keyword(s):  
Tax Reform ◽  
The World ◽  
Consumption Taxes
Sign in / Sign up

Export Citation Format

Share Document