Shop – Page 9 – Economics for Policy

Transfer Pricing Rules, OECD Guidelines, and Market Distortions

0 Available
seats

We study the impact of transfer pricing rules on prices, firms’ organizational structure, and consumers’ utility in a two-country monopolistic competition model with source-based profit taxes. Firms can either be multinationals and serve the foreign market through a fully controlled affiliate, or be exporters and serve the foreign market by contracting with an independent distributor. (…)

Competing in Taxes and Investment under Fiscal Equalization

Susana Peralta

Teacher

0 Available
seats

The paper considers a model of federation with two heterogeneous regions that try to attract the capital by competing in capital income taxes and public investment that enhance the productivity of capital. Regions’ choices determine allocation of capital across the regions and their revenues under a tax sharing scheme. (…)

Currency Substitution and Money Demand in Euroland

Miguel Lebre Freitas

Teacher

0 Available
seats

This paper tests the stability of the demand for money in the euro-area in the context of an open economy. A sample consisting of quarterly data covering the 1982:2-1999:3 period is considered. The main finding is that the U.S. dollar long-term interest rate plays a significant role in the European money demand relationship. (…)

Portugal-EU Convergence Revisited: Evidence for the Period 1960-2003

Miguel Lebre Freitas

Teacher

0 Available
seats

This paper uses the stochastic approach to convergence to investigate whether real per capita GDP in Portugal has been converging to the EU15 average. The estimation accounts for conditional convergence, transitional dynamics and up to two structural breaks. (…)

Currency Substitution, Portfolio Diversification, and Money Demand

Miguel Lebre Freitas

Teacher

0 Available
seats

We extend the Thomas (1985) dynamic optimizing model of money demand currency substitution to the case in which the individual has restricted or no access foreign currency denominated bonds. In this case currency substitution decisions and a substitution decisions are not separable. (…)

Political Support for Tax Decentralization

Susana Peralta

Teacher

0 Available
seats

We present a spatial model of a city with two unequally productive jurisdictions. City residents bear a commuting cost to work in either of the two jurisdictions. Each jurisdiction must finance a public budget with a wage and a head tax. (…)

The Open Society Assesses its Enemies: Shocks, Disasters and Terrorist Attacks

José Tavares

Teacher

0 Available
seats

This paper conducts a systematic investigation of the incidence and economic costs of terrorist attacks at the country level. We use newly assembled data sets on terrorist attacks, natural disasters and currency crises to answer three different questions: what are the determinants of terrorism; is there an output cost following a terrorist attack; and is that cost larger or smaller in the case of democracies. (…)

The Dynamics of Inflation and Currency Substitution in a Small Open Economy

Miguel Lebre Freitas

Teacher

0 Available
seats

This paper analyzes the relationship between money and inflation in a small open economy, where domestic and foreign currencies are perfect substitutes as means of payment. It is shown that, if the path of domestic money supply is such that individuals find it optimal to change the currency in which transactions are settled, there will be an adjustment period during which domestic inflation adjusts to equal the foreign inflation rate. (…)

Does Right or Left Matter? Cabinets, Credibility and Fiscal Adjustments

José Tavares

Teacher

0 Available
seats

This paper tests the widely held assumption that left-wing cabinets favor higher public spending and examines whether cabinet ideology affects the persistence of major fiscal adjustments. In a panel of large fiscal adjustments in OECD countries during the last 40 years, we find evidence that left-wing and right-wing cabinets are partisan: the left tends to reduce the deficit by raising tax revenues while the right relies mostly on spending cuts. (…)