taxation and international migration of superstars evidence from the european football market we analyze the effects of top tax rates on international migration of football players in 14 european countries since 1985 both country case studies and multinomial regressions show evidence of strong mobility responses to tax rates with an elasticity of the number of foreign domestic players to the net of tax rate around one around 0 15 we also find evidence of sorting effects low taxes attract highability players who displace low ability players and displacement effects low taxes on foreigners displace domestic players those results can be rationalized in a simple model of migration and taxation with rigid labor demand jel f22 h24 h31 j44 j61 l83

the market value of reducing cancer risk hedonic housing prices with changing information 1 introduction market evidence on the value of a statistical life invariably consists of cross sectional evidence on risks and prices or wages at a point in time if information about the level of risk changes over time and people incorporate this information in a rational manner there will be a corresponding price response on the basis of these temporal changes one can estimate the market price risk tradeoff eliminating many confounding time invariant effects that cannot be controlled for using cross sectional data this paper examines the market response to the release of government information about the level of risk at hazardous waste sites and provides insight into the rationality of this response studies based on experimental evidence and survey data often find that individual beliefs may deviate from objective risk levels 1 people often overestimate highly publicized risks and mortality risks in the case of hazardous waste risks bias in risk beliefs often leads to considerable public reaction and pressure for site cleanups which may be an inefficient outcome by using market data one can examine whether this intense public reaction carries over to contexts in which private money is at stake government agencies frequently use information provision as a regulatory device particularly since the advent of the right to know movement of the 1980s examples of information provision efforts include the food and drug administration s requirement that many prescription drugs indude information inserts the department of housing and urban development s requirement that sellers of houses built before 1950 inform buyers about the presence of lead based paints and the environmental protection agency s epa requirement that manufacturing facilities report their annual releases of chemicals above a threshold amount for a list of over 600 substances such regulations imply a belief that citizens can learn from information about risk and rationally adjust their prior beliefs towards the objective risk level in light of the information this article provides market evidence to bolster the results of some survey studies of information transfer that suggest that individuals revise their risk beliefs in response to new information 2 the u s federal policy dealing with hazardous waste sites is known as the superfund program the most hazardous sites are targeted for cleanup and placed on a government priority roster called the national priorities list npl extension of the classic theory of compensating differentials to the housing market implies that environmental disamenities such as hazardous waste sites will reduce housing prices rosen 1974 the negative impact of hazardous waste sites on the housing prices of nearby residences is well documented for example in a previous study gayer hamilton and viscusi 2000 we used an analysis that focused on the sale of 16 928 houses from 1988 to 1993 that surround superfund sites in greater grand rapids michigan we found that before the epa released its risk report a reduction in the cancer risk from neighborhood superfund sites by the mean level of risk would increase the average value of a house by 238 in 1996 dollars 3 to estimate this willingness of residents to pay to avoid cancer risks before the release of the epa s risk report we assumed that residents prior beliefs were equal to the objectively measured risks suggested by the report thus this analysis was based on the very strong informational assumption that residents could in effect predict the results of the epa s site specific risk assessments before the release of the report the price risk tradeoff implied a value of a statistical cancer case of 51 million once the epa released its risk information the implied value of a statistical cancer case was 4 million these results suggest that after the release of the epa s risk report revealed preferences for avoiding superfund risks were consistent with surveys of the value of a statistical life in the labor market

the balance of power in rural marketing networks a case study of snake trading in cambodia abstract producers in small scale rural markets often receive unfavourable prices for their goods as a result of more powerful market participants this study uses a combination of price analysis and interview data to assess the position of snake hunters in the aquatic snake market from tonle sap lake in cambodia despite the hunters dependence on intermediary traders for market access and credit the evidence implies that they are not powerless participants intermediary traders operate under high competition as a result of the increasing scarcity of snakes and therefore despite interlocked credit and snake markets offer relatively high prices to hunters

private values of risk tradeoffs at superfund sites housing market evidence on learning about risk this paper incorporates a bayesian learning model into a hedonic framework to estimate the value that residents place on avoiding cancer risks from hazardous waste sites we show that residents are

status seeking income taxation and efficiency abstract it is well known that status seeking produces distortions in consumption competition to achieve status leads to over consumption of those goods which confer status it has been found that taxing such goods may even lead to pareto improvements in this paper we extend a model of status which relies on a signalling equilibrium approach to include the individual labour supply decision and an income tax we show that a pareto improving income tax can exist even with the simplest tax benefit scheme a number of results follow the model is extended to a two period analysis to accommodate the reputation building element of status achievement without altering the conclusions

generalised morality and the problem of transition to an impersonal exchange regime a response to platteau this essay addresses the problem of transition from a personalised exchange regime that characterises most ldcs to the more impersonal form of exchange that marks advanced market economies this debate has received impetus from the discussion launched by platteau 1994 in the pages of this journal where he seeks to clarify the social conditions that allow the market system to evolve while the role of private and public order institutions in generating market order is recognised this is regarded as inadequate necessitating the invocation of generalised morality gm to complete the explanation it is argued here that gm does not need to be invoked the article pleads for taking a closer look at the historical role of risk bearing institutions especially financial institutions evidence from the bangladesh rice market is adduced in support of the contention that there exist elements even within a traditional exchange regime that can evolve into modern impersonal forms this is brought out by ex

using elasticities to derive optimal income tax rates this paper derives optimal income tax formulas using compensated and uncompensated elasticities of earnings with respect to tax rates a simple formula for the high income optimal tax rate is obtained as a function of these elasticities and the thickness of the top tail of the income distribution in the general non linear income tax problem this method using elasticities shows precisely how the different economic effects come into play and which are the key relevant parameters in the optimal income tax formulas of mirrlees the optimal non linear tax rate formulas are expressed in terms of elasticities and the shape of the income distribution these formulas are implemented numerically using empirical earning distributions and a range of realistic elasticity parameters

facilitating the provision of farm credit the role of interlocking transactions between traders and zamindars in crop marketing systems in sindh abstract formal credit institutions in pakistan have largely failed to provide access to farm credit to small and medium scale landowners or zamindars this paper examines interlocked transactions between traders and landowners in the cotton and wheat markets in sindh that facilitate the provision of credit by traders it is concluded that the case examined provides an example where traders lend to landowners in a segment of the credit market that approximates competitive behavior without surplus extraction by traders key conditions resulting in this favorable outcome are the existence of both competition for market share and information sharing on borrowers between traders whether this outcome is also beneficial for other rural groups who may borrow from landowners in particular sharecropping tenants is independent of market relations between landowners and traders and is not determined here

markets power and productivity in rural asia abstract this article deals with three themes first the evidence that rural markets are responsive to scarcity is open to two interpretations i that markets closely approach the competitive ideal and ii that such responses are also consistent with various market imperfections second there is the nature of power and its influence on economic transactions lacking a satisfactory definition of the concept many contributions dealing with power yield few insights third there is the relationship between agrarian structure and economic progress a signal accomplishment of some contributions has been to show that south asia s diverse experience casts considerable doubt on the proposition that this relationship is a simple one

altruism jealousy and the theory of optimal non linear taxation abstract this paper studies optimal non linear taxes in a world in which there is altruism and jealousy a formula for optimal marginal tax rates is derived which turns out to be a simple and intuitively appealing extension of a result due to mirrlees the paper shows that in this sort of economy all of optimal tax theory s general results either no longer hold or need not hold and it sets out appropriate modifications to standard tax rules

class relations in an asiatic regime this paper develops a theoretical analysis of the economic and political relationships among the state the peasantry and zamindars in mughal india 1550 1750 the analysi s rests on a pasinetti type accumulation model which also incorporate s state taxation tax evasion a wages fund and a variable peasant s aving propensity it is shown that zamindar incomes and the economic dependence of peasants are related to the extent of state taxation an d of evasion potential sources of systematic change are identified b y highlighting both conflict and harmony of class interests arising f rom taxation evasion military or luxury expenditures and productiv e investments copyright 1987 by oxford university press

optimal income tax in the presence of status effects abstract the existence of distortions from individuals competing to attain social status by using consumption signals justifies some measure of income tax as a counter acting distortion the question posed here is whether it also constitutes a reason for a more progressive income tax schedule the answer is found to be broadly negative if progressiveness is interpreted as a more convex tax schedule unless the rich are more concerned with status seeking than the poor on the other hand status seeking makes the optimal tax schedule steeper so that redistribution is increased essentially the analysis of status seeking based on a signaling approach confirms and strengthens the existing view of an optimal tax schedule and can be incorporated into the diamond american economic review 88 1998 83 95 approach

forced commerce and agrarian growth abstract the paper explains why contractually interlocked agrarian markets differ from price and quantity adjustments under pressures of excess demand supply in neoclassical general equilibrium analysis such contractual interlocking arising say from the indebtedness of the peasants gives rise to a contrived system of forced commerce this commercial mode of exploitation not only exhibits unequal relations of economic power but more important it is also a mechanism for maintaining such unequal power structure often at the cost of retarding agrarian growth the paper thus emphasizes the need to understand the very notion of market exchange and commerce in backward agriculture from an unconventional viewpoint

taxation and the international mobility of inventors we study the eect of top tax rates on superstar inventors international mobility since 1977 using panel data on inventors from the u s and european patent oces we exploit the dierential impact of changes in top tax rates on inventors of dierent qualities superstar inventors location choices are signicantly aected by top tax rates in our preferred specication the elasticity to the net of tax rate of the number of domestic superstar inventors is around 0 03 while that of foreign superstar inventors is around 1 these elasticities are larger for inventors in multinational companies an inventor is less sensitive to taxes in a country if his company performs a higher share of its research there

interest rates in backward agriculture the role of economic and extra economic control this paper examines the nature and roles of personalized control exercised by the rural moneylender over a class of poor borrowers to extract as much as possible in the form of high interest charges and income from undervalued and or forfeited collaterals based on primary survey data from rural india it analyzes the strategies adopted by the lender through economic and extra economic instruments to enforce the credit contracts to accomplish his goals it also provides a vivid picture of the variations in the level of interest rates and the reasons for it across a class of borrowers in the sample copyright 1990 by oxford university press

interlocking transactions obstacles precursors or instruments of agrarian capitalism abstract rural labor arrangements often change rapidly and in ways that prevailing theories cannot explain explicit understanding of the exercise of power in rural society sheds considerable light on how and why rural labor arrangements change in the course of economic development this paper shows how different labor tying arrangements embody exclusionary mechanisms that can serve as instruments of both labor management and social control macro political and economic conditions shape the ways in which these mechanisms operate and are in turn influenced by them viewing labor arrangements in this way helps resolve problems confronted by the prevailing theories and allows for a broader understanding of dynamic processes

interlinked contracts and social power patronage and exploitation in india s waste recovery market abstract interlinked contracts have been examined almost exclusively in the context of the rural sphere this article describes the nature of exchange regimes between two sets of primary collectors of recyclable waste that is waste pickers and itinerant buyers and their dealers in the city of delhi far from the casualised labour transaction commonly described for the unorganised urban sector the findings portray a picture of personalised and surprisingly long term exchange between the parties while a new institutional economics approach might explain the underlying motivation and consequent general form of the implicit contracts it cannot explain the differential nature of each it is suggested that in order to do that a political economy approach must be taken this would understand interlinked transactions as being embedded within and consequently influenced by the particular social context in this case of an inequitable and impermeable caste hierarchy amongst those that engage in waste work

relativity mobility and optimal nonlinear income taxation in an open economy abstract recent evidence suggests that globalization has reduced the barriers to international labor mobility and induced more cross country social comparisons in an open economy with tax driven migration and consumption externalities relativity we derive an optimal tax formula that subsumes existing ones obtained under a maximin social objective and additively separable utility and sign the second best mirrleesian marginal tax rates for all skill levels we establish the thresholds of the elasticity and level of migration to determine when relativity and inequality act as complements or substitutes in shaping the optimal top tax rate under both nash and stackelberg tax competition if the migration probability of top income workers is approximately 50 numerical calculation using parameter estimates from empirical studies shows that the country with labor inflow outflow implements over 10 lower higher marginal tax rates than suggested by the autarky equilibrium of kanbur and tuomala 2013

optimal taxation when consumers have endogenous benchmark levels of consumption i examine optimal taxes in an overlapping generations economy in which each consumer s utility depends on consumption relative to a weighted average of consumption by others the benchmark level of consumption as well as on the level of the consumer s own consumption the socially optimal balanced growth path is characterized by the modi ed golden rule and by a condition on the intergenerational allocation of consumption in each period a competitive economy can be induced to attain the social optimum by a lump sum pay as you go social security system and a tax on capital income

why institutional credit agencies are reluctant to lend to the rural poor a theoretical analysis of the indian rural credit market abstract this paper examines why institutional credit facilities remain unable to extend credit to the rural poor analysis indicates that poor peasants at best can offer an entitlement set as a mortgage comprised only of future shares of their harvest which itself is subject to risk consequently lenders can not advance loans without risking extensive loss of loanable funds as the landlords income is subject to the same risk as that of peasants they advance loans to ensure that their own income is not affected by the peasants financial situation an extension of institutional credit to peasants results only in subsidization of landlords

income inequality in the united states 1913 1998 this paper presents new homogeneous series on top shares of income and wages from 1913 to 1998 in the united states using individual tax returns data top income and wages shares display a u shaped pattern over the century our series suggest that the large shocks that capital owners experienced during the great depression and world war ii have had a permanent effect on top capital incomes we argue that steep progressive income and estate taxation may have prevented large fortunes from fully recovering from these shocks top wage shares were flat before world war ii dropped precipitously during the war and did not start to recover before the late 1960s but are now higher than before world war ii as a result the working rich have replaced the rentiers at the top of the income distribution

optimal marginal and average income taxation under maxi min using the mirrlees optimal income tax model with a maxi min social welfare function we derive conditions for a decreasing marginal tax rate throughout the skill distribution a strictly concave tax function in income and a single peaked average tax schedule with additive preferences and a constant labor supply elasticity marginal tax rates are decreasing below the modal skill level and will also decrease above the mode if aggregate skills are non decreasing with the skill level in this case and with a bounded skill distribution or with a constant hazard rate the tax function is strictly concave in income and the average tax rate single peaked when quasilinear utility functions apply in either consumption or leisure under fairly mild restrictions on the truncated or untruncated distribution function marginal tax rates are decreasing in skill and the average tax profile is single peaked the distribution of skills has the same quantitative influence for either case of quasilinearity these results continue to hold when there is bunching at the bottom due to a binding non negativity constraint we also illustrate how relaxing the assumption of constant elasticity of labor supply generally used in the literature modifies the results

marketing cooperative vs commission agent the turkish dilemma on the modern fresh fruit and vegetable market in turkey the wholesale markets law was enacted in 1995 to facilitate small scale growers access to the fresh produce market cooperatives and commission agents have thus become the main marketing structures available to small scale fresh produce growers to supply supermarkets and comply with their new requirements in this paper we question the advantages and disadvantages that confront small farmers with respect to those marketing structures to allow for market matching or quality upgrading drawing on ownership and transaction cost arguments we use an analytical framework to identify and compare the costs of these marketing organizations based on data collected through a large number of interviews with stakeholders we show that commission agents and credit cooperatives tend to be more efficient than traditional cooperatives as regards sales performance and decision costs however the lack of apparent competition between commission agents does not allow for sufficient provision of incentives for producers to invest in high quality production consequently credit cooperatives are the only structure progressively turning to strategies of quality upgrading and supermarket supply the flipside of such strategies is that they may lead to the marginalization of small scale farmers

the elasticity of taxable income with respect to marginal tax rates a critical review this paper critically surveys the large and growing literature estimating the elasticity of taxable income with respect to marginal tax rates using tax return data first we provide a theoretical framework showing under what assumptions this elasticity can be used as a sufficient statistic for efficiency and optimal tax analysis we discuss what other parameters should be estimated when the elasticity is not a sufficient statistic second we discuss conceptually the key issues that arise in the empirical estimation of the elasticity of taxable income using the example of the 1993 top individual income tax rate increase in the united states to illustrate those issues third we provide a critical discussion of selected empirical analyses of the elasticity of taxable income in light of the theoretical and empirical framework we laid out finally we discuss avenues for future research jel h24 h31 j22

the role of input vouchers in modernizing the fresh fruit and vegetable market in turkey contractual arrangements between farmers and traders aiming at providing input credit in return for output selling have been widely studied in the literature on agricultural economics nonetheless there is one issue which is barely mentioned in the literature how to enforce the contract terms when traders offer credit in cash rather than input advances this article aims to describe an innovation in farming contracts used by fresh fruit and vegetable wholesalers in turkey which involves a kind of private voucher system drawing on original data collected from wholesalers a segment in the supply chain hardly covered in the literature we investigate the factors determining contract adoption using a two limit tobit model our results suggest that this private voucher system contributes to supply chain coordination and facilitates smallholder farmer participation in export and supermarket channels which are growing rapidly in this developing country resume d auteur

relativity inequality and optimal nonlinear income taxation how does concern for consumption relative to others relativity affect the structure of optimal nonlinear income taxation our article provides three sets of answers to this general question first it supports the conclusion in the literature that relativity leads to higher marginal tax rates in doing so it both generalizes some of the conditions under which this result is obtained in the literature and fleshes out the detailed structure for optimal marginal tax rates for specific functional forms for distribution utility function and social welfare function second the article goes beyond the literature and examines the impact of relativity on the progression of optimal marginal tax rates by and large we find support for greater progressivity defined as the steepness of the rise of the marginal tax rate schedule as relativity concern increases third none of the papers in the literature to our knowledge examines the interplay of relativity and inequality in determining the optimal structure of income taxes our special analytical cases and more general numerical calculations support the conclusion that higher inequality dampens the positive impact of greater relativity on the level and the progression of marginal tax rates more work is needed to further explore this interaction between relativity and inequality that our analysis has uncovered

optimal income tax under the threat of migration by top income earners we examine how allowing individuals to emigrate to pay lower taxes changes the optimal nonlinear income tax scheme in a mirrleesian economy an individual emigrates if his domestic utility is less than his utility abroad net of migration costs utilities and costs both depending on productivity a simple formula that complements saez s formula obtained in closed economy is derived for the marginal tax rates faced by top income earners it depends on the labour elasticity the tax rate abroad and the migration costs expressed as a fraction of the utility obtained abroad the rawlsian marginal tax rates obtained for the whole population illustrate a curse of the middle skilled simulations are provided for the french economy

credit and sharecropping in agrarian societies this paper considers a model of linkage between land labor and credit transactions in the context of sharecropping the paper s objectives are a to derive and characterize the equilibrium in a model of a land scarce labour abundant economy under sharecropping given an infinitely elastic supply of identical sharecroppers at a reservation utility and b to demonstrate that in an imperfect market a landlord may offer credit to his tenant sometimes even at a subsidized rate of interest without necessarily insisting that the sharecropper borrow only from him precluding an involuntary linkage between credit and land transations it has been demonstrated that regardless of the presence or absence of linkage or any other control by the landlord as long as he can vary the size of the plot given to a tenant and there are enough potential tenants in equilibrium contracts a tenants utility under sharecropping will be the same as that which he could have obtained as a full time wage laborer this result implies that policies other than land reform will not affect the welfare of tenants

food marketing liberalization and trader entry evidence from madagascar abstract food marketing liberalization was expected to induce massive trader entry and competitive markets in africa despite evidence of trader entry enterprise expansion remains difficult and many claim market power persists though perhaps in different hands this paper confronts this puzzle of substantial market entry that might not foster competition data from madagascar reveal distinct groups within rural food marketing channels separated by intraindustry mobility barriers that limit entry to a few niches moreover individuals place within the rural marketing network is defined largely by a priori social identity so the experience of food marketing liberalization varies across socially distinct subpopulations

segmentation collateral undervaluation and the rate of interest in agrarian credit markets some evidence from two villages in south india this paper examines certain issues pertaining to the structure of agrarian credit markets in developing countries using empirical evidence on credit transactions from two villages in south india first the bases for the segmentation between formal and informal sectors of the credit market are identified as being 1 the type of collateral offered on credit contracts and 2 the purpose for which credit is taken secondly the paper shows the occurrence of a systematic association between rates of interest and types of collateral the evidence supports the hypothesis that lower marketability of collateral security and hence higher undervaluation increases the rate of interest charged on a loan thirdly the evidence shows an inverse relationship between the value of land owned by a borrower and the rate of interest on a credit contract copyright 1991 by oxford university press

imperfect information screening and the costs of informal lending a study of a rural credit market in pakistan many governments have perceived the rural moneylender as usurious this article takes a first step toward directly testing the validity of this view in a study of services costs and charges of fourteen informal market moneylenders and their clients in chambar pakistan the article examines whether the high implicit interest rates charged reflect the actual costs of operating in that market estimates of the resource costs incurred by informal lenders for screening pursuing delinquent loans overhead and cost of capital including unrecoverable loans suggest that lenders charges are equal to their average cost of lending but exceed their marginal cost this finding is consistent with the view that the informal credit market is characterized by excess capacity and monopolistic competition in the presence of imperfect information

economic returns to social power merchants finance and interlinkage in the grain markets of bangladesh abstract the paper describes contrasting forms of interlinked transaction and the exchange regimes in which they are situated in two rural areas of bangladesh a fast growing green revolution area and a slow growing backward area some interlinkages fix output and finance prices for producers others establish personalized monopsony in trade the implication for rates of return and vulnerability of the different forms of interlinked transaction are explored perverse risk transfer from less to more vulnerable parties is found particularly when interlinkages are combined the market structures described appear to emerge not from government intervention but from the uneven distribution of local power and are thus unlikely to be improved by structural adjustment reforms or by price focused policies

should public policy respond to positional externalities abstract a nice suit is one that compares favorably with those worn by others in the same local environment more generally a positional good is one whose utility depends strongly on how it compares with others in the same category 1 a positional externality occurs when new purchases alter the relevant context within which an existing positional good is evaluated 2 for example if some job candidates begin wearing expensive custom tailored suits a side effect of their action is that other candidates become less likely to make favorable impressions on interviewers from any individual job seeker s point of view the best response might be to match the higher expenditures of others lest her chances of landing the job fall but this outcome may be inefficient since when all spend more each candidate s probability of success remains unchanged all may agree that some form of collective restraint on expenditure would be useful in such cases however it is often impractical to negotiate private solutions do positional externalities then become legitimate objects of public policy concern in attempting to answer this question i employ the classical libertarian criterion put forth by john stuart mill 3 who wrote the state may not legitimately constrain any citizen s freedom of action except to prevent harm to others i argue that many positional externalities appear to meet mill s test causing not just negative feelings but also large and tangible economic costs to others who are ill equipped to avoid them i also discuss an unintrusive policy remedy for positional externalities one modeled after the use of effluent charges to curb environmental pollution the paper is organized as follows section 1 notes the deep similarity between the conditions that give rise to positional arms races and those that give rise to conventional military arms races section 2 follows with a review of evidence concerning the strength of concerns about relative position section 3 describes some of the tangible economic costs that people experience as a result of positional externalities arising from such concerns section 4 takes up the question of whether collective action directed against positional externalities is consistent with respect for individual rights section 5 describes how a progressive consumption tax could neutralize many of the most costly effects of positional externalities

efficient estimation methods for closed ended contingent valuation surveys closed ended contingent valuation surveys can be very useful in the evaluation of nonmarket resources respondents merely state whether they would accept or reject a hypothetical threshold amount either as payment for giving up access to the resource or as a fee for its use the authors develop a maximum likelihood procedure which exploits the variation in the threshold values to allow direct and separate point estimates of regression like slope coefficients and error standard deviations without truncation bias their illustration uses data from a survey of recreational fisherman to examine factors which influence individuals willingness to pay copyright 1987 by mit press

choice welfare and development a festschrift in honour of amartya k sen professor amartya sen has been a distinguished and influential scholar in development economics for over twenty years and this edited volume seeks to reflect his interests and the inspiration he has provided for others the editors have succeeded in creating a coherent and stimulating set of papers from well known contributors the volume deals with the enduring themes of amartya sen s work ranging through theoretical issues of development economics to the philosophical foundation of welfare systems and ethics in society contributors kenneth arrow a b atkinson pranab bardhan j l coles rajat deb jean dreze louis gevers peter hammond ravi kanbur eric maskin robert nozick siddiq osmani martin ravallion kevin roberts robert solow s wibaut

migration and wage effects of taxing top earners evidence from the foreigners tax scheme in denmark this paper analyzes the eects of income taxation on the international migration and earnings of top earners using a danish preferential foreigner tax scheme and populationwide danish administrative data this scheme introduced in 1991 allows new immigrants with high earnings to be taxed at a preferential at rate for a duration of three years we obtain two main results first the scheme has doubled the number of highly paid foreigners in denmark relative to slightly less paid and therefore ineligible foreigners this translates into a very large elasticity of migration with respect to 1 minus the average tax rate on foreigners between 1 5 and 2 second we nd compelling evidence of a negative eect of the scheme induced reduction in the average tax rate on pre tax earnings of foreign migrants at the individual level this nding can be rationalized by a matching frictions

the benefits of avoiding cancer or dying from cancer evidence from a four country study abstract we use stated preference methods to estimate the cancer value per statistical life vsl and value per statistical case vscc from a representative sample of 45 60 year olds in four countries in europe we ask respondents to report information about their willingness to pay for health risk reductions that are different from those used in earlier valuation work because they are comprised of two probabilities that of getting cancer and that of dying from it conditional on getting it in the first place the product of these two probabilities is the unconditional cancer mortality risk our hypothetical risk reductions also include two severity related attributes quality of life impacts and pain the results show that respondents did appear to have an intuitive grasp of compound probabilities and took into account each component of the unconditional cancer mortality risk when answering the valuation questions we estimate the cancer vsl to be between approximately 2 and 5 950 million depending on whether the unconditional mortality risk was reduced by lowering the chance of getting cancer increasing the chance of surviving cancer or both the vscc is estimated to be up to 0 578 million euro and its magnitude depends on the initial conditional cancer mortality and on the improvement in survival the survey responses show that our measures of cancer severity impacts on daily activities and pain have little or no effect on the wtp to reduce the adverse health risks

migration and optimal income taxes abstract the issue addressed in this paper is the optimal taxation of incomes earned in the home economy and of incomes earned abroad when people can migrate as a preliminary the optimal taxation of home incomes when there is migration and no taxation of foreign incomes is discussed then in a more general setting we deal with optimal taxation of different kinds of labour when another kind of labour is not taxable and show how this bears on the taxation of foreign incomes the last sections of the paper analyse a simple model in which people choose between taxable labour at home taxable labour abroad and untaxable labour a condition is found implying that the optimal tax on foreign income is higher than on the home income of a person of equal utility

the case for a progressive tax from basic research to policy recommendations the fair distribution of the tax burden has long been a central issue in policyhe fair distribution of the tax burden has long been a central issue in policymaking a large academic literature has developed models of optimal tax making a large academic literature has developed models of optimal tax theory to cast light on the problem of optimal tax progressivity in this theory to cast light on the problem of optimal tax progressivity in this paper we explore the path from basic research results in optimal tax theory to paper we explore the path from basic research results in optimal tax theory to formulating policy recommendations formulating policy recommendations models in optimal tax theory typically posit that the tax system should maximize a models in optimal tax theory typically posit that the tax system should maximize a social welfare function subject to a government budget constraint taking into account social welfare function subject to a government budget constraint taking into account that individuals respond to taxes and transfers social welfare is larger when resources that individuals respond to taxes and transfers social welfare is larger when resources are more equally distributed but redistributive taxes and transfers can negatively are more equally distributed but redistributive taxes and transfers can negatively affect incentives to work save and earn income in the fi rst place this creates the clasaffect incentives to work save and earn income in the fi rst place this creates the classical trade off between equity and effi ciency which is at the core of the optimal income sical trade off between equity and effi ciency which is at the core of the optimal income tax problem in general optimal tax analyses maximize social welfare as a function of tax problem in general optimal tax analyses maximize social welfare as a function of individual utilities the sum of utilities in the utilitarian case the marginal weight for individual utilities the sum of utilities in the utilitarian case the marginal weight for a given person in the social welfare function measures the value of an additional dollar a given person in the social welfare function measures the value of an additional dollar of consumption expressed in terms of public funds such welfare weights depend on of consumption expressed in terms of public funds such welfare weights depend on the level of redistribution and are decreasing with income whenever society values the level of redistribution and are decreasing with income whenever society values more equality of income therefore optimal income tax theory is fi rst a normative more equality of income therefore optimal income tax theory is fi rst a normative theory that shows how a social welfare objective combines with constraints arising from theory that shows how a social welfare objective combines with constraints arising from limits on resources and behavioral responses to taxation in order to derive specifi c limits on resources and behavioral responses to taxation in order to derive specifi c

who compares to whom the anatomy of income comparisons in europe this article provides unprecedented direct evidence from large scale survey data on both the intensity how much and direction to whom of income comparisons income comparisons are considered to be at least somewhat important by three quarters of europeans they are associated with both lower levels of subjective well being and a greater demand for income redistribution the rich compare less and are happier than average when they do which latter is consistent with relative income theory with respect to the direction of comparisons colleagues are the most frequently cited reference group those who compare to colleagues are happier than those who compare to other benchmarks

the value of disease prevention vs treatment we present an integrated valuation model for diseases that are life threatening the model extends the standard one period value per statistical life model to three health prospects healthy ill and dead we derive willingness to pay values for prevention efforts that reduce a disease s incidence rate as well as for treatments that lower the corresponding health deterioration and mortality rates we find that the demand value of prevention always exceeds that of treatment people often overweight small risks and underweight large ones we use the rank dependent utility framework to explore how the demand for prevention and treatment alters when people evaluate probabilities in a non linear manner for incidence and mortality rates associated with common types of cancers the inverse s shaped probability weighting found in experimental studies leads to a significant increase in the demand values of both treatment and prevention

social preferences self interest and the demand for redistribution preferences for redistribution may be influenced by values and beliefs about distributive justice as well as by self interest people may prefer more redistribution to the poor if they believe that poverty is caused by circumstances beyond individual control therefore beliefs about the causes of income may affect demand for redistribution alternatively the effect of these beliefs on redistributive preferences may be spurious if they are correlated with income and self interest is not properly controlled for they may also measure incentive cost concerns using social survey data i find that self interest cannot explain the effect of these beliefs on redistributive preferences 2001 elsevier science b v all rights reserved

strategic nonlinear income tax competition with perfect labor mobility abstract tax competition between two governments who choose nonlinear income tax schedules to maximize the average utility of their residents when skills are unobservable and labor is perfectly mobile is examined we show that there are no equilibria in which there is a skill type that pays positive taxes to one country and whose utility is larger than the average utility in the other country or in which the lowest skilled are subsidized we also show that it is possible for the most highly skilled to receive a net transfer funded by taxes on lower skilled individuals in equilibrium these findings confirm the race to the bottom thesis in this setting

testing market integration a model of spatial price differentials for a tradable good is proposed which avoids the inferential dangers of received methods using static price correlations the proposed method also extracts more information on the causes of price differentials from the same data the method is illustrated using monthly rice price data for postindependence bangladesh including the very substantial regional price shocks during the 1974 famine impediments to market integration are indicated

interactions between institutional and informal credit agencies in rural india in an attempt to expand rural credit and displace the village moneylender india created a system of rural cooperatives in the 1950s and expanded branch banking into rural areas in the 1970s this article examines how these measures affected the rural market it begins with the question of how large the expansion of institutional credit has been and the extent to which it has dislodged the village and nonresident moneylenders a detailed comparison of three major surveys of the indian rural credit market suggests that in various guises the moneylender is still a major source of loans the article also examines the weak evidence on intermediation between the formal and informal sectors a formal model of the interaction between the informal moneylender and institutional lender is constructed under a variety of assumptions about the exclusivity of loan contracts and the competitive structure of the informal sector the conclusions are drawn together in the form of five proposals for public policy