commodity tax harmonization and the location of industry we study the positive implications of commodity taxation and tax harmonization under the destination and origin principles when firms are monopolistic competitors facing variable demand elasticity and segmented markets our emphasis is on the international location of firms in the presence of market size asymmetries and trade costs under the destination principle an increase in the tax rate of a country always causes some firms to relocate to the other this effect may be reversed under the origin principle when economic integration is deep enough under tax harmonization the choice of a common tax principle is irrelevant for the market outcomes and for the global tax revenues it affects however the distribution of revenues between small and large countries c 2006 elsevier b v all rights reserved

learning about a new technology pineapple in ghana this paper investigates the role of social learning in the diffusion of a new agri cultural technology in ghana we use unique data on farmers communication patterns to define each individual s information neighborhood conditional on many potentially confounding variables we find evidence that farmers adjust their inputs to align with those of their information neighbors who were surpris ingly successful in previous periods the relationship of these input adjustments to experience further indicates the presence of social learning in addition applying the same method to input choices for another crop of known technol ogy correctly indicates an absence of social learning effects jel d83 013 033 q16

the effects of taxation price control and government contracts in oligopoly and monopolistic competition abstract many government contracts with or policies towards oligopolistic sectors essentially involve private firms selling a given proportion or quantity of output to the government at a fixed price p r with the remainder being sold on the open market often this is combined with consumer rationing examples include cement and sugar in india and health housing and defence in many countries the paper investigates the effects of these schemes including sales and excise taxation on prices output and household welfare under oligopoly and monopolistic competition less government control reduced may raise prices and tax shifting can be above or below 100 percent

oligopoly and welfare a unified presentation with applications to trade and development abstract we develop a unified sequence of models to examine the determinants of price output profitability and concentration for different kinds of oligopolistic market we relate various magnitudes of significance to judges of welfare and to policy makers such as consumer surplus profit or added benefits of employment or trade surplus to observable magnitudes such as the size and concentration of the market it emerges that various appropriately formulated herfindahl indices are useful in several of these relations we attempt to present results in a way that is useful for empirical investigations and pay particular attention to applications in trade and development

employers recruitment behaviour and vacancy duration an empirical analysis for the dutch labour market the functioning of labour markets from a demand side perspective is examined in particular the determinants of vacancy duration are studied in the context of a model of employers search behaviour a model for the choice of the recruitment strategy at the start of the search process and the corresponding recruitment duration is developed in which allowance is made for different patterns of duration dependence for each recruitment strategy this model is applied to data on employers search behaviour in the dutch labour market it is found that employers prefer advertisements as the first recruitment channel when applicants are required to have work experience moreover employers prefer to start searching via the labour exchange office when jobs in the secondary segment of the labour market have to be filled it is also found that when advertisements are used as the first recruitment strategy employers need some time to acquire a pool of applicants and to select candidates from this pool it is inte

reassessment of the tiebout model abstract the tiebout model has been the reference point for the classical approach to fiscal federalism its emphasis on mobility benefit taxation and the advantages of fiscal competition have informed fiscal federalism since the seminal contributions of musgrave and oates this paper reviews the influence that the tiebout model has had on fiscal federalism and argues that while its insights remain relevant for local government it is far from compelling as a positive description of or a normative prescription for fiscal federalism at the state level some aspects of alternative approaches are presented which lead to different perspectives than tiebout inspired ones

cross border shopping and the optimum commodity tax in a competitive and a monopoly market using a partial equilibrium model optimality rules for a commodity tax are derived for an economy that is exposed to cross border shopping in a competitive market the conventional inverse elasticity rule is shown to be valid with the qualification that it is the elasticity of domestic rather than total demand that matters with a foreign monopoly the inverse elasticity is modified by a tax shifting effect when the supplier is a multinational firm price repercussions abroad should be taken into account the implications for domestic taxation of the prices and taxes set abroad are also examined

social networks and technology adoption in northern mozambique despite their potentially strong impact on poverty agricultural innovations are often adopted slowly using a unique household dataset on sunflower adoption in mozambique we analyse whether and how individual adoption decisions depend upon the choices of others in the same social networks since farmers anticipate that they will share information with others we expect farmers to be more likely to adopt when they know many other adopters dynamic considerations however suggest that farmers who know many adopters might strategically delay adoption to free ride on the information gathered by others we present empirical evidence that shows that the relationship between the probability of adoption and the number of known adopters is shaped as an inverse u in line with information sharing the network effect is stronger for farmers who report discussing agriculture with others the data contains information which is needed to ameliorate the identification issues that commonly arise in this context in particular social networks are precisely identified and in addition we can control for village heterogeneity and endogenous group formation

tax competition and tax co ordination under destination and origin principles a synthesis this paper proposes a general framework for analysing commodity tax competition under destination and origin principles based on three possible tax spillovers the consumer price spillover the producer price terms of trade spillover and rent spillovers a model is presented which can be extended to accommodate all three spillovers using this model many of the results in the existing literature can be derived compared and extended

a generalized equivalence property of mixed international vat regimes it is shown that the equivalence of a global destination based and a global origin based vat regime can be extended to a class of mixed regimes where the origin principle is applied for all trade within the eu and a destination based eu specific border tax adjustment is applied for eu trade with the rest of the world such a unified restricted origin regime is superior to the non reciprocal restricted origin regime proposed by lockwood de meza and myles 1994a since it is the more general vat regime and offers a higher probability of political acceptance than the latter regime

lessons from the u s unemployment insurance experiments recent social experiments have evaluated two reforms of the unemployment insurance ui system reemployment bonuses and job search programs the bonus experiments show that economic incentives affect the length of ui receipt and provide weak evidence that an earlier return to work does not decrease earnings the experiments do not show the favorability of a permanent bonus program as they ignore its effect on the number of the claimants the job search experiments test several more promising reforms nearly all of the combinations of services and increased enforcement reduce ui receipt and have favorable cost benefit analyses earnings often increase though the estimates are imprecise

the comparison between destination and origin principles under imperfect competition abstract especially but not only in the european union closer economic integration is putting increasing pressure on the destination principle under which goods entering international trade are normally taxed this has raised the possibility of switching to the origin principle which dispenses with problematic border tax adjustments this paper compares destination and origin principles under conditions of imperfect competition previous analyses which have considered only the competitive case have led to a qualified presumption in favour of the destination principle a series of results are established here for both cooperative and non cooperative tax setting which challenge that presumption under imperfect competition

taxes intermediate goods and relative prices the case of variable coefficients abstract price effects of an output tax in sector 1 and an equivalent production subsidy in the second industry are analyzed in a general equilibrium model each commodity satisfies final demand and uses two primary inputs and the other good as an intermediate product production coefficients are variable and demand is elastic in a leontief model with fixed coefficients metzler showed that price of the taxed good will rise and price of the subsidized good will fall this result generally holds under less restrictive conditions also although it is sometimes reversed how the topic relates to the tax incidence literature is also discussed

value added taxation in the ec after 1992 abstract this paper examines the quantitative effects of the transitional system of value added taxation for intra ec trade between 1993 and 1997 as recently adopted by the ecofin council first the administration of the current destination principle and the interim solution are described a short representation of the empirical general equilibrium model featuring seven ec regions and 14 production sectors follows finally the effects of a switch to the transitional system are evaluated by using numerical simulations the adopted provisions with regard to cross frontier sales to final consumers open tax arbitrage possibilities which favour low tax countries at the cost of their ec partners when decomposing welfare effects international tax revenue shifts prove to dominate while substitution effects have relatively little influence on economic welfare

harmonisation of commodity taxes the restricted origin principle comment abstract this note shows that within a model where tariffs have distorted the pre tax situation as in the one used by berglas 1981 application of the restricted origin principle causes resource misallocation even when trade deflection takes place this conclusion is different from the one derived from models where the pre tax situation is pareto optimal e g shibata 1967 where trade deflection guarantees optimal allocation

unemployment insurance and male unemployment duration in canada a model of unemployment duration is estimated with weekly micro data on canadian men entitlement provisions in the unemployment insurance program and demand conditions are found to have a significant effect on the probability of leaving unemployment the probability of a worker leaving unemployment declines with the duration of unemployment holding unemployment insurance entitlement constant when entitlement is allowed to vary the probability of leaving first falls and then generally rises with unemployment duration these results are robust with respect to allowing for person specific unobserved heterogeneity and alternative specifications of duration dependence

a european vat on financial services financial services vat vat in europe eu financial services are exempted of vat for technical reasons this paper argues that the changed nature of bank client relationships and advances in information technology have opened the door to a practical way of redressing this exemption the proposed solution is to charge the regular vat on services supplied to households but no vat on those supplied to businesses while allowing financial institutions the normal vat credit for all of their purchased inputs financial services would as a result be priced differently for households and businesses so banks would have to verify their customers vat status while this may be burdensome the oecd wide fight against tax evasion and the international struggle against terrorism have forced financial institutions to know much more about their clients verifying clients vat status should thus be fairly simple the paper also evaluates the economic impact of reform and finds that reform would significantly increase vat revenues while having little impact on overall welfare households would see an increase in the price of financial services but given the relatively high incomes of mortgage takers the burden of the tax would be approximately proportional across income classes harry huizinga

unemployment and nonemployment heterogeneities in labor market states abstract the determination of how to distinguish between unemployment and nonparticipation is important and controversial the conventional approach employs a priori reasoning together with self reported current behavior this paper employs an evidence based classification of labor force status using information about the consequences of the behavior of the nonemployed we find that marginal attachment defined as desiring work although not searching is a distinct labor market state lying between those who do not desire work and the unemployed furthermore important heterogeneities exist within these nonemployment states two subsets of nonparticipants both engaged in waiting display behavior similar to the unemployed

does the public employment service affect search effort and outcomes in this paper we examine the disincentive effects of the public employment service on the search effort of unemployed workers and on their exit rate from unemployment for that purpose we specify a structural search model with fixed and variable costs of search in which unemployed workers select their optimal search intensity given the exogenous arrival rate of job contacts coming from the public employment agency because the theoretical effect of an increase in this exogenous job contact arrival rate on the structural exit rate from unemployment is ambiguous we estimate this model using individual unemployment duration data our results show that the exit rate from unemployment increases with the arrival rate of job contacts obtained by the public employment service especially for low educated and low skilled workers they also show that the search effort is more costly for low educated women and low skilled adult unemployed workers this last result suggests that a public employment agency that matches searchers and employers is beneficial in the sense that it saves searchers in terms of search costs they would otherwise bear

tax incidence in a hierarchical model abstract production hierarchies are common in input output tables but have not been used much in analytical work on tax incidence a general equilibrium model with two mobile factors and flexible production coefficients is set up for this purpose earlier studies generally assumed one factor and fixed coefficients there is one intermediate good a final good and one with both final and intermediate uses some features of existing models with intermediate and final goods carry over to hierarchical technology but results about incidence of factor and commodity taxes differ markedly even under severe restrictions on elasticities of substitution and other parameters

learning by doing and learning from others human capital and technical change in agriculture household level panel data from a nationally representative sample of rural indian households describing the adoption and profitability of high yielding seed varieties hyvs associated with the green revolution are used to test the implications of a model incorporating learning by doing and learning spillovers the estimates indicate that i imperfect knowledge about the management of the new seeds was a significant barrier to adoption ii this barrier diminished as farmer experience with the new technologies increased iii own experience and neighbors experience with hyvs significantly increased hyv profitability and iv farmers do not fully incorporate the village returns to learning in making adoption decisions

harmonization of commodity taxes destination origin and restricted origin principles abstract the three tax principles are compared using a multiproduct custom union model it is shown that if member countries use the destination or origin principles no distortion or redistribution of income occurs even if their tax rates differ however under the restricted origin principle different tax rates result in distortion and income redistribution equal tax rates still result in a redistribution of real income an exact measurement of this redistribution is derived given these results it seems possible to conclude that the origin principle is superior to the other tax principles

is internet job search still ineffective using national longitudinal survey of youth nlsy97 data for 2005 8 we find that unemployed persons who look for work online are re employed about 25 faster than comparable workers who do not search online this finding contrasts with previous results for 1998 2001 and is robust to controls for cognitive test scores and detailed indicators of internet access internet job search ijs appears to be most effective in reducing unemployment durations when used to contact friends and relatives to send out resumes or fill out applications and also to look at advertisements we detect a weak positive relationship between ijs and wage growth between jobs over the past decade the internet has been credited for substantial reductions in search frictions in markets ranging from life insurance to apartment rentals brown and goolsbee 2002 kroft and pope 2010 in contrast studies of the internet s effects on labour market matching have been few in number and on balance find little or no evidence of a friction reducing effect for example kuhn and skuterud 2004 find that unemployed workers who look for work online have longer unemployment durations than comparable non internet searchers whereas kroft and pope 2010 find no evidence that the rapid expansion of craigslist as a job search tool has affected city level unemployment rates 1 at least on the surface these results seem puzzling in view of the dramatic expansion of online job search sites as well as the general decline in communication costs associated with the internet both of these changes should increase the arrival rate of matches between job searchers and vacancies thereby reducing search frictions in labour markets in this study we provide new evidence relevant to this puzzle of ineffective internet job search ijs using data on young us jobseekers during the period 2005 8 taken from the national longitudinal survey of youth nlsy97 our main result is that internet searchers unemployment durations are about 25 shorter than comparable workers who search offline only specifically after replicating kuhn and skuterud s 2004 estimate of a counterproductive effect of ijs using their current population survey cps data from 1998 2001 for this age group we show that this counterproductive effect is reversed in the more recent period in the same regression specification this reversal holds whether or not we control for a possible source of endogenous selection searchers scores on a widely used cognitive skills test that was not available in the earlier data we speculate that improvements in technology over this period ranging from better online job sites to network externalities associated with greater overall internet penetration might explain this change over time

fair trade organic coffee rural livelihoods and the agrarian question southern mexican coffee families in transition summary we use a random sample of coffee producing households in southern mexico to compare opportunities associated with government subsidies and migration to the role of fair trade organic coffee in household livelihoods although land and labor returns among fair trade organic coffee growers are higher than for conventional growers differences in yields are more important than price premiums moreover investment in education and labor opportunities outside coffee dominate those in fair trade organic coffee the results highlight the value of an integrated approach to the agrarian question that improves productivity and prices and supports other pathways for improving incomes

job search methods and their success a comparison of immigrants and natives in the uk a major issue in the immigration debate concerns whether immigrants take jobs away from natives in this article we present new evidence on the job search methods used by immigrants and their relative success in gaining employment in the uk we find that 1 immigrant job search is less successful than that of natives 2 immigrants are as likely to gain employment through informal methods as via verifiable routes 3 the probability of success increases with years since migration the finding that immigrants do not effectively compete for jobs may help explain why immigration has little impact on native employment

do friends and relatives really help in getting a good job informal contacts are extensively used by both firms and workers to find jobs and fill vacancies the common wisdom in the economic literature is that jobs created through this channel are of better quality and pay higher wages than jobs created through formal methods this paper explores the empirical evidence for european countries using the european community household panel echp and discovers a large cross country as well as cross industry variation in the wage differentials between jobs found through informal and formal methods across countries and industries wage premiums and wage penalties to finding jobs through personal contacts are equally frequent this paper argues that such variation can be explained by looking at firms recruitment strategies in labour markets where employers invest largely in formal recruitment activities matches created through this channel are likely to be of average better quality than those created through informal networks a simple theoretical model is used to show that employers invest more in recruitment for high productivity jobs and for positions that require considerable training the empirical predictions of the theory are successfully tested using industry level data on recruitment costs

fishing in different pools job search strategies and job finding success in canada in the early 1980s this article examines the job search methods of jobless workers and emphasizes sample selectivity in choice of job search strategies especially use of public employment agencies longitudinal data from the labour force survey of canada for 1981 1983 and 1986 indicate that job search methods change with the business cycle and that many people find jobs without any reported search the determinants of job search success also vary substantially over the business cycle implying a substantial social return to public employment agencies at the 1983 trough of the recession but no noticeable benefits when aggregate unemployment is relatively low

value added tax and the theory of tax incidence abstract a value added tax is examined in a general equilibrium model of tax incidence incorporating primary factors and intermediate goods production coefficients are variable and demand is elastic the principal result is that under assumptions of fixed coefficients and inelastic demand which have been commonly employed in the literature vat as well as the corporation income tax will be neutral in the more general setting of this paper only vat applied to every industry at equal rates will not affect relative factor and commodity prices incidence and other economic effects of a partial vat are also discussed

welfare effects of changing commodity tax rates toward uniformity abstract this paper presents a theory of tax reform that is applicable to a many good economy where i the initial tax structure is arbitrarily given ii no lump sum tax exists and iii the initial tax revenue must be maintained after the reform sufficient conditions are established under which tax changes definitely result in increases in welfare they indicate that in a wide class of situations the uniform tax structure can be a useful intermediate target on the way to optimum

public good provision and the welfare effects of indirect tax harmonisation the paper considers the welfare effect of the harmonisation of indirect taxes in two open economies the revenue from taxation is used for the production of a non tradeable public good the welfare levels are affected via two channels i changes in the levels of public good provision and ii changes in deadweight loss associated with the taxes we develop a number of rules of harmonisation and derive conditions under which they lead to potential pareto improvement

public employment agencies and unemployment spells reconciling the experimental and nonexperimental evidence econometric evidence strongly suggests that unemployed job seekers who use the services of a public employment agency pea have longer unemployment spells than those choosing alternative search methods yet in some well designed u s experiments increased use of pea services has been associated with faster transitions intojobs the author argues that the nonexperimental studies may be biased toward finding a positive relationship between unemployment spell duration and pea use because they ignore the possibility that peas are chosen by manyjobseekers only after other search methods have been tried unsuccessfully and a period of unemployment has elapsed an analysis of u k survey data with information on the timing of pea use in 1987 88 supports that hypothesis

informal job search and black youth unemployment in this paper i analyze how young black and white unemployed jobseekers use various methods of search and the employment outcomes which result from their use the focus is on distinguishing informal search methods i e friends and relatives or direct application without referral from more formal ones in analyzing racial differences the results show that the two informal methods of search account for about 90 of the difference in employment probabilities between white and black youth this also accounts for 57 71 of the difference in unemployment rates between the two furthermore most of these results reflect differences in the ability of these methods to generate job offers as opposed to differences in search effort or job acceptance rates however our ability to explain these differences through personal family and household characteristics was generally quite limited this abstract was borrowed from another version of this item

reforming an asymmetric union on the virtues of dual tier capital taxation the tax competition for mobile capital in particular the reluctance of small countries to agree on measures of tax coordination has ongoing political and economic fallouts within europe we analyse the effects of introducing a two tier structure of capital taxation where the asymmetric member states of a union choose a common federal tax rate in the first stage and then non cooperatively set local tax rates in the second stage we show that this mechanism effectively reduces competition for mobile capital between the members of the union moreover it distributes the gains across the heterogeneous states in a way that yields a strict pareto improvement over a one tier system of purely local tax choices we also discuss the effects of diverging capital endowments within the union and capital flows to third countries

the future of value added tax in the european union the current vat regime in the eu introduced with the removal of fiscal frontiers in 1993 is explicitly transitional we consider the issues that arise in designing a definitive regime the two most widely canvassed options adoption of a clearing house or a shift to origin taxation are found wanting the paper develops an alternative strategy combining a harmonized rate of vat on transactions between firms both between and within member states with national discretion over rates applied to final sales this offers the prospect of a real improvement on current arrangements

economic effects of vat reforms in germany in the tax policy debate differentiation of value added taxes is often justified by distributional concerns our quantitative analysis for germany indicates that such concerns are misplaced we find that the abolition of vat differentiation has only negligible redistributive effects instead reduced vat are found to act as industry specific subsidies whereas the overall welfare effects of pure vat reforms are very small a revenue neutral introduction of a harmonised vat combined with reductions in the marginal income tax rates or social security contributions turns out to produce substantial welfare gains for all households

which border taxes origin and destination regimes with fiscal competition in output and emission taxes abstract this paper posits a two stage game in tax regime and tax rates to study the property of second best emission and output taxes in a two country world with an atmospheric externality it shows that i either the destination destination or the origin origin tax regime may constitute the subgame perfect nash equilibrium of this game ii either regime may pareto dominate the other iii it is possible to have a prisoner s dilemma game where the origin origin regime pareto dominates but the choice of the destination regime is the dominant strategy for each country other results include iv under origin origin regime the output tax is used for fiscal competition the emission tax is set at a rate equal to the national marginal social damage of emissions and public goods are provided suboptimally v under destination destination regime the output tax is ineffective as an instrument for fiscal competition the emission tax is used not only for combating pollution but also for tax competition the tax is set at a rate below the national marginal social damage of emissions emissions are pushed above their closed economy level the provision of public goods are optimal

technology and tax systems abstract technological innovations facilitating e commerce have had major effects on consumer behavior and firm organization in the retail sector but the effects of these new transaction technologies on fiscal systems remain unknown we extend models of commodity tax competition to include multiple types of commodities trade and remote commerce assuming in accordance with current policy that e commerce is taxed at destination while cross border shopping is taxed at origin when the cost of online shopping falls we show that equilibrium tax rates and revenues decrease in large core jurisdictions but increase in small peripheral ones reducing tax differentials policy commentators warn that e commerce erodes tax revenue true enough for some governments but more accurately changing transaction costs can generate entirely new commercial and fiscal equilibria that ultimately redistribute tax revenues from jurisdictions with concentrations of traditional vendors toward others with some reinterpretation the model is also adapted to analyze profit tax competition when firms can respond to high taxes both through profit shifting and through relocation each dependent on transactions costs changes in technology may again redistribute tax revenues from high tax to low tax jurisdictions

did the single market cause competition in excise taxes evidence from eu countries tax competition theory predicts that the introduction of the eu single market in 1993 should have caused excise tax competition and thus increased strategic interaction in the setting of excise taxes among eu countries we test this prediction using a panel data set of 12 eu countries over the period 1987 2004 we find that for excise duties on still and sparkling wine beer and ethyl alcohol strategic interaction significantly increased after 1993 there is weaker evidence of increased interaction in cigarette taxes possibly because cigarettes are widely smuggled giving rise to tax competition even before the single market

endogenous job contact networks we use the uk quarterly labour force survey to document the presence of two phenomena first a positive correlation between unemployment rate and the proportion of job seekers who use social networks to nd jobs network use second a non monotone relation between unemployment rate and the proportion of recently employed workers who found their job through friends or relatives network productivity this second relation is positive for low levels of unemployment rate while it becomes negative for high levels of unemployment rate existing models of social networks and labor market generally assume that social networks are exogenous this assumption implies a negative correlation between unemployment rate and network productivity we develop a model where social networks are used to collect job oers but workers decide strategically how much to invest in their network we show that equilibrium job contact networks are dense and more productive in transmitting information when labor market turnover is moderate while they are less productive and segmented into clusters for either high or low turnover the equilibrium response of job contact networks to changes in labor market conditions is sucient to generate

commodity tax competition between member states of a federation equilibrium and efficiency we first describe regional market equilibria whereupon consumers of each region allocate their purchases of private goods between domestic and nondomestic ones according to the structure of relative prices taxes and transportation costs next regional optimal tax levels and public good quantities are derived the tax of the other region being held constant fiscal competition arises from the ability of one region in choosing its tax to alter the tax base of the other

exemption versus zero rating a hidden problem of vat abstract we examine the difference between exemptions and zero rating under a consumption based vat in a numerical general equilibrium model to allow for a better understanding of the accruing efficiency effects we first develop a method to convert the nominal vat rates into effective tax rates on categories of final demand then we show how these effective tax rates can be used to perform a gradual transition from exemption to zero rating

middlemen in bilateral search markets this article examines the role of middlemen in bilateral search markets e g employment agencies real estate brokers it is shown that the middleman narrows the set of buyer firm and seller worker types who search seller types with high valuations and buyer types with low valuations drop out of the search market and instead trade through the middleman the middleman also decreases the equilibrium search intensities of those agents who search it is proven that the middleman improves welfare if search is very costly and inefficient and decreases welfare if search is effectively costless and very efficient

optimal taxes and the structure of preferences if optimal tax theory is to be the basis for calculating tax rates a close understanding is required of the relationship between the structure of preferences and the configuration of optimal tax rates otherwise hypotheses chosen by the econometrician for practical convenience may completely determine the results independently of measurement this paper explores the relationship between various types of separability particularly weak and implicit separability and optimal tax rates in the various models discussed in the literature the use of distance functions and the antonelli matrix provides a significant unification of previously disparate results in the final analysis optimal tax theory should be the basis for actual calculation of tax rates although recently there have been great advances in theoretical results and in our understanding of their meaning we are still some way from a working knowledge of whether uniform commodity taxes are in practice optimal or if not which commodities should be discriminated against present theoretical formulae do not yield clear cut results except in special cases and it has recently become clear that optimal rates depend crucially on the detailed structure of consumer preferences for example atkinson and stiglitz 3 show that with an optimal nonlinear income tax discriminatory commodity taxes are only necessary to the extent that individual commodities are not weakly separable from leisure more recently deaton 6 has shown that a similar result holds for what is perhaps the most interesting of the standard models that where there are many consumers and only a linear income tax and proportional commodity taxes are allowed in this case separability between goods and leisure together with linear engel curves for goods removes the need for differential commodity taxation in consequence nothing can be learned about commodity taxes from consumer demand studies in which commodity demands are explained conditionally on total expenditure and commodity prices and which assume linear engel curves all such studies require separability from leisure as a maintained hypothesis and so are consistent with uniform commodity taxation these results suggest that the prospects for meaningful empirical calculations of tax rates are bleak econometricians estimating commodity demand and labor supply equations make generous use of separability assumptions to enable estimation at all in consequence it is likely that empirically calculated tax rates based on econometric estimates of parameters will be determined in structure not by the measurements actually made but by arbitrary untested and even unconscious hypotheses chosen by the econometrician for practical convenience to remedy this situation and as a prelude to fruitful empirical work it is necessary to have a more explicit understanding of how preference structure affects optimal tax rates such is the object of this paper three different

unit tax versus ad valorem tax a tax competition model with cross border shopping abstract within the framework of spatial tax competition with cross border shopping we examine the choice of tax method between ad valorem tax and unit specific tax this study shows that governments endogenously choose the ad valorem tax method not because of a classic welfare reason but because it is a good strategy to compete for mobile consumers another key finding is that while governments are committed to the ad valorem tax method the choice leads to inferior outcome tax cutting competition becomes more serious when countries adopt ad valorem tax and competition in ad valorem tax results in smaller tax revenue than competition in unit tax

the economic sustainability of certified coffee recent evidence from mexico and peru consumers increasingly act on preferences for a more just and sustainable world by purchasing certified agricultural products using survey data from coffee growers in mexico and peru we explore the economic sustainability of certified coffee looking at conventional fair trade organic and rainforest alliance certified growers the analysis reveals that yields rather than price premiums are most important for increasing net cash returns for coffee growing households given the link between net returns and producer participation in certified coffee schemes the findings suggest that certification norms that permit improving yields are essential for improving grower welfare and attracting and maintaining growers

disentangling the effects of fair trade on the quality of malian cotton the increasing importance of premium segments and private labels raise skepticism about the ability of fair trade to help smallholders compete in high value added markets using panel data collected in mali this paper contributes to the debate by estimating the impact of fairtrade certification on the quality of malian cotton controlling for the nonrandom certification of producers results show a significant impact on the quality of cotton produced by both certified and geographically close noncertified growers via spillover effects the analysis suggests that contract farming enforced by third parties and demonstration effects foster the adoption of innovative agricultural practices

adoption curves and social interactions this paper considers the observational implications of social influences on adoption decisions for an environment of perfect foresight adopters we argue that social influences can produce two observable effects 1 discontinuities in unconditional adoption curves and 2 pattern reversals in conditional adoption curves in which earlier adoption is found for one group of actors versus another when fundamentals suggest the reverse ordering should occur in turn the presence of either of these features can under weak assumptions be interpreted as evidence of social influences as such these properties are robust implications of social effects jel c40 d01 o33

are there spatial spillovers in the adoption of clean technology the case of organic dairy farming this paper examines spatial spillovers associated with the adoption of organic dairy farming we hypothesize that neighboring farmers can help to reduce the uncertainty of organic conversion by lowering the fixed costs of learning about the organic system a spatially explicit 10 year panel dataset of more than 1 900 dairy farms in southwestern wisconsin is used as input into a reduced form econometric model of the decision to convert to organic production using an identification strategy that exploits the panel aspect of the micro dataset we find evidence that the presence of neighboring organic dairy farms affects the conversion decision

bending the pipeline executive search and gender inequality in hiring for top management jobs we study the sources of women s underrepresentation in hiring for top management jobs by focusing on the context of executive search using data that include proprietary information on 10 970 individuals considered by a search firm we examine the sources of the low proportion of women placed in senior roles contrary to received wisdom we find limited evidence that demand side screeners strongly contribute to gender disadvantage in this setting what gender differences exist tend to play out at the start of the hiring process and are driven both by supply side and demand side actors once considered for a position women are no less likely than men to be hired though they are slightly less likely to be interviewed by the search firm our findings highlight the theoretical importance of disentangling candidates self steering behavior from the pipeline bending of hiring agents we discuss the implications of our results for understanding gender inequality at upper echelons of the labor market this p

excess worker reallocation workers face a trade off between macroeconomic and individual incentives to work in different occupations industries namely between search frictions and personal comparative advantages workers endowed with heterogeneous multi dimensional skills search for jobs that require different skill combinations in equilibrium specialized individuals contact few selected types of vacancies where they are likely to be hired those with weak comparative advantages are seldom chosen among competing applicants thus seek any job type in a tight labour market comparative advantages dominate waiting costs offsetting labour mobility across industries occupations excess worker reallocation is lower and matches are more successful consistently with direct and indirect evidence

empirical matching functions searchers vacancies and un biased elasticities this paper shows that conventional empirical estimates of matching functions are systematically biased because unobservable and endogenous search behaviour such as on the job search by workers or the use of different search channels by firms is neglected i propose an approach for recovering unbiased elasticities under different scenarios of competition for workers and jobs without the need for constructing proxies for unobserved stocks of searchers and vacancies using german administrative data i estimate the biases affecting conventional studies and derive bias corrected estimates of the matching elasticities under different scenarios

the origin principle tax harmonization and public goods abstract this paper takes up two tasks firstly it shows that the conclusion drawn in lucas 2001 lucas v 2001 tax harmonisation and the origin principle economic letters 71 111 115 regarding potential pareto improvement in small open economies needs to be amended secondly in large open economies it verifies that some reasonable conjectures concerning the welfare effects of a particular tax harmonizing reform hold under the origin based tax system when public goods are present

identification of endogenous social effects the reflection problem this paper examines the reflection problem that arises when a researcher observing the distribution of behaviour in a population tries to infer whether the average behaviour in some group influences the behaviour of the individuals that comprise the group it is found that inference is not possible unless the researcher has prior information specifying the compisition of reference groups if this information is available the prospects for inference depend critically on the population relationship between the variables defining reference groups and those directly affecting outcomes inference is difficult to implossible if these variables are functionally dependent or are statistically independent the prospects are better if the variables defining reference groups and those directly affecting outcomes are moderately related in the population

implementing tax coordination abstract this paper investigates whether tax competition can survive under tax coordination when information is private or nonverifiable we focus on a two jurisdiction model where capital can move across borders and where jurisdictions have different public good requirements but are otherwise identical in this setting coordination may call for a second best allocation supported by differentiated tax rates if however coordination must be achieved via a set of common rules that condition tax rates on jurisdictions choices the second best allocation may not be implementable we show that incentive compatibility requirements will generally affect not only the choice of coordinated rates in states where jurisdictions are different but also the choice of harmonized rates in states where jurisdictions have identical preferences for public consumption

the relationship between unemployment spells and reservation wages as a test of search theory the theory of stationary job search predicts that controlling for other factors that affect the probability of leaving unemployment duration and reservation wages are likely to be positively associated the paper tests this prediction for british cross sectional data from 1982 using an estimating equation implied by search theory simultaneity is crucial in the evaluation of this prediction with single equation and instrumental variable estimates differing markedly perhaps surprisingly given the extreme paucity of both job interviews and offers in the sample the main finding is that reservation wages play a significant role in the determination of duration

the concept of employability the concept of employability plays a crucial role in informing labour market policy in the uk the eu and beyond this paper analyses current and previous applications of the term and discusses its value as an exploratory concept and a framework for policy analysis it then traces the development of the concept discusses its role in current labour market and training strategies with particular reference to the uk and seeks to identify an approach to defining employability that can better inform labour market policy by transcending explanations of employment and unemployment that focus solely on either supply side or demand side factors although the literature offers a range of definitions of employability many policy makers have recently used the term as shorthand for the individual s employability skills and attributes it is argued that this narrow usage can lead to a hollowing out of the concept of employability the paper concludes by presenting a broad framework for analysing employability built around individual factors personal circumstances and external factors which acknowledges the importance of both supply and demand side factors

internet job search and unemployment durations after decades of stability the technologies used by workers to locate new jobs began to change rapidly with the diffusion of internet access in the late 1990 s which types of persons incorporated the internet into their job search strategy and did searching for work on line help these workers find new jobs faster we address these questions using measures of internet job search derived from the december 1998 and august 2000 cps computer and internet supplements matched with job search outcomes from subsequent cps files we find that internet searchers are positively selected on observables but negatively selected on unobservables a beneficial unemployment duration reducing causal effect of internet job search is consistent with our estimates only if negative selection on unobservables is especially strong in other words only if the population of on line resumes is strongly adversely selected

a general equilibrium analysis of the 1986 tax reform in spain spain s recent entry into the european economic community eec has been accompanied by a number of economic reforms needed to comply with requirements imposed on a11 member countries a key ingredient of these reforms has been the introduction on i january 1986 of a vaiue added tax vat on consumption as a substitute for a complex range of indirect taxes including a turnover tax applied at every stage of the production process the fiscal reform has posed a number of interesting policy questions for instance one common criticism of the new tax system is that its rates have been chosen too high and will further depress the economy whose oflicial unemployment rate was 22 in 1985 government officials are very concerned however with the effect of the new tax system on public revenues and in turn on the substantial deficit of the public sector which was 8 of gdp in 1985 another current debate centers on whether the new tax system has a detrimental impact on the capital labor ratio due to the retention of social security taxes which are taxes on the use of labor in this paper we use an applied general equilibrium model of the spanish economy to analyze the impacts of the indirect tax reform on relative prices resource allocation and income distribution using the information contained in the social accounting matrix constructed by kehoe et al 1985 in the next section we describe the model placing emphasis on its novel features in

commodity tax competition under destination and origin principles abstract this paper studies the effect of switching from the destination to the origin principle of taxation on non cooperative commodity tax equilibrium when taxes are constrained to be uniform across commodities the switch has no effect when differentiated taxes are allowed the effects of the switch depend on whether countries are small or large in both cases the switch imposes the requirement that taxes must be uniform across commodities within each country in the second case there are two further effects of the switch i negative spillover effects from tax policy are introduced ii incentives to manipulate the terms of trade are changed the switch does not necessarily lead to a fall in all tax rates

reported vs actual job search by unemployment insurance claimants this study compares self reported job search contacts of unemployment insurance recipients with independently verified job search contacts for the total sample reported contacts averaged 2 61 per week compared with actual contacts of only 1 78 per week nearly one fifth of the sample made no job contacts for the single weeks analyzed the separate equations estimated for reported and actual job contacts suggest that systematic misreporting may distort the conclusions particularly for the impact of unemployment insurance benefits on search intensity that would result from analyzing reported rather than actual contacts some implications of the findings for reported unemployment rates also are explored

destination based vs origin based commodity taxation in large open economies with unemployment we construct a perfectly competitive model of two symmetric countries producing tradable commodities and a public consumption good destination or origin based taxes are levied on the consumption of the tradable goods in both countries a fixed wage leads to involuntary unemployment we derive the nash equilibrium consumption taxes under the two taxation principles with endogenous world prices and compare them to i the cooperative rates and ii the rates when world prices are fixed we demonstrate that with endogenous world prices the induced terms of trade effects cancel out under the destination principle but they prevail under the origin principle of taxation nash equilibrium destination based taxes are inefficiently low when the exporting sector in each country is non labour intensive the nash equilibrium origin based taxes can be either higher or lower than the corresponding cooperative rates

optimal public good provision in the ramsey tax model a generalization abstract for the single consumer ramsey tax model the use of distortionary taxation to finance public good provision is shown to lower the optimal level of public good provision below its optimal value ina first best economy where lump sum taxation is available the assumptions used in the proof include a previous cobb douglas example as a special case

will destination based taxes be fully exploited when available an application to the u s commodity tax system abstract we develop a tax competition model that allows for the setting of both an origin based and a destination based commodity tax rate in the presence of avoidance and evasion in the presence of evasion jurisdictions will give cross border shoppers tax preferential treatment thus not fully exploiting the potential of destination based taxation moreover the divergence between origin based and destination based taxes is stronger when the incentives for consumers tax arbitrage opportunities increase the united states is one example of many such systems while sales taxes are due at the point of sale use taxes are due on goods purchased out of state we document that when able to set both rates a majority of jurisdictions levy destination based use taxes at a lower rate than origin based sales taxes in response to changes in state level policies that increase tax avoidance opportunities the results of the empirical model broadly confirm our theory

the measurement of unemployment an empirical approach although the unemployment rate is one of the most widely cited and closely monitored economic statistics the definition and measurement of unemployment remain controversial an important issue is whether non employed persons who display a marginal attachment to the labor force for example those who are available for and desire work but are not searching for work should be classified as unemployed or non participants although this issue has been extensively debated it has never been tested empirically this paper carries out empirical tests of this and related hypotheses using a unique longitudinal data set from canada we find within the marginally attached a waiting group whose behavior indicates that they would be more appropriately classified as unemployed rather than out of the labor force the remainder of the marginally attached exhibit behavior between that of the unemployed and the balance of non participants suggesting that the desire for work among non searchers conveys substantial information about labor force attachment and future employment status our methods also apply to heterogeneity within the unemployed and we investigate behavioral variation linked to differences in job search methods and reasons for entry into unemployment although those using passive job search do exhibit behavior somewhat distinct from active searchers our results reject the practice of classifying passive job searchers as out of the labor force overall our results indicate that the non employed are very heterogeneous so that any single division into unemployment and out of the labor force is unlikely to fully capture the variety of degrees of labor force attachment this abstract was borrowed from another version of this item

tax incidence with strategic firms in the soft drink market abstract because soft drink sd consumption is considered to be a contributor to the epidemic of obesity there is a growing interest in evaluating the impact on sd consumption of alternative tax policies in this paper we propose a methodology to evaluate the impact of taxation of a food market taking into account the strategic price response of both manufacturers and retailers we apply this methodology to the french sd market and simulate the impacts of ad valorem and excise taxes we find that firms behave differently when facing an ad valorem tax or an excise tax an excise tax is overshifted to consumer prices while an ad valorem tax is undershifted to consumer prices we find that an excise tax based on the sugar content of sd is the most effective at reducing sd consumption our results also indicate that ignoring strategic pricing by firms leads to misestimations of the impact of taxation by between 15 and 40 depending on the products and the tax implemented in the short term that is ignoring positive long term health effects a 9 cents l excise tax has a small negative welfare effect about 1 person year

asymmetric commodity tax competition comment on de crombrugghe and tulkens abstract a widely noticed result by de crombrugghe and tulkens journal of public economics 41 1990 335 350 states that asymmetric commodity tax competition always leads to tax rates being too low in both countries even though there are counteracting private and public consumption effects for the high tax region this note argues that the result depends crucially on the assumption that welfare in the high tax region is concave in the tax rate of the low tax country and shows that this assumption cannot generally be met in the underlying mintz and tulkens journal of public economics 29 1986 133 172 model it is also shown that a tax increase in the low tax country will hurt the high tax region when the marginal transaction cost schedule is sufficiently elastic with respect to the level of cross border shopping

the importance of learning in the adoption of high yielding variety seeds to date due to the lack of panel data most micro level empirical studies of technology adoption have used cross sectional data these studies cannot examine the dynamic processes of adoption such as learning this article uses panel data to study the adoption of a new high yielding variety seed first it establishes that learning is an important variable in the adoption process second it establishes that cross sectional estimates of a dynamic process are biased but that the extent of this bias may be small third it illustrates the econometric methods needed to estimate a dynamic model when controlling for unobserved household heterogeneity

pareto efficient international taxation this paper analyzes pareto efficient international tax regimes because every country faces its own national budget constraint the diamond mirrlees production efficiency theorem which underlies key tenets of policy advice in international taxation the desirability of destination basis for commodity taxation of the residence principle for capital income taxation and of free trade does not apply the paper establishes conditions relating to the availability of explicit or implicit devices for reallocating tax revenues across countries under which production efficiency is nevertheless desirable and characterizes the precise ways in which pareto efficient international taxation may require violation of established tenets

tacit collusion and international commodity taxation the paper employs a model of dynamic price competition to study how international commodity taxation affects the stability of collusive agreements when producers in an international duopoly agree not to export into each other s home market we consider both the choice of international tax principle and the harmonization of tax rates and differentiate between a setting where production costs differ between countries and a setting where exogenous tax rate differentials are the only asymmetry the conclusions derived from this model differ strongly from those obtained under the assumption of competitive product markets

information transmission in irrigation technology adoption and diffusion social learning extension services and spatial effects in this article we investigate the role of information transmission in promoting agricultural technology adoption and diffusion through extension services and social learning we develop a theoretical model of technology adoption and diffusion which we then empirically apply using duration analysis on a micro dataset consisting of recall data covering the period 1994 2004 for olive producing farms from crete greece our findings suggest that both extension services and social learning are strong determinants of technology adoption and diffusion while the effectiveness of each of the two informational channels is enhanced by the presence of the other

wage setting and the tax system theory and evidence for the united kingdom abstract this paper analyses the effects of a non linear tax system on wage bargaining the main conclusions are an increase in the marginal income or payroll tax rate reduces the pre tax wage in the isoelastic case an increase in the average tax rate increases the pre tax wage by more than the tax increase and a measure of the progressivity of the tax system residual income progression is a sufficient measure of the effect of the tax system on wage pressure empirical evidence is presented to support these propositions and the predictions of the model regarding the effect of recent changes to the u k tax system on the distribution of earnings discussed

the complex dynamics of smallholder technology adoption the case of sri in madagascar this article explores the dynamics of smallholder technology adoption with particular reference to a high yielding low external input rice production method in madagascar we present a simple model of technology adoption by farm households in an environment of incomplete financial and land markets we then use a probit model and symmetrically censored least squares estimation of a dynamic tobit model to analyze the decisions to adopt expand and disadopt the method we find that seasonal liquidity constraints discourage adoption by poorer farmers learning effects both from extension agents and from other farmers exert significant influence over adoption decisions

social learning and technology adoption the case of coffee pruning in peru a unique natural experiment involving a coffee pruning technology is used to study social learning the yield effects of pruning take two years to appear a characteristic that aids in identifying social learning apart from correlated unobservable variables that are a concern in the social learning and technology adoption literature panel data are employed that start with a private initiative which introduced systematic pruning in central peru and that contain the population of participating growers results show a jump of at least 0 15 in the probability of adoption two years after the first pruning in a grower s group jel classifications d83 q12

the equivalence between destination and non reciprocal restricted origin tax regimes it is well known that destination and reciprocal restricted origin tax regimes are only equivalent under very stringent conditions an alternative nonreciprocal restricted origin regime is proposed and then shown to be equivalent to the destination regime under a wide set of conditions including imperfect competition and transport costs the policy implications of the result for the european community are discussed copyright 1994 by the editors of the scandinavian journal of economics

carbon taxes with exemptions in an open economy a general equilibrium analysis of the german tax initiative abstract sectoral exemptions from environmental regulation are applied in many countries to avoid adverse adjustment effects in specific industries the problem with exemptions is that they can make environmental policy more costly our paper analyzes the welfare costs of exemptions in environmental policy together with the issue of unilateral carbon taxes in an open economy several countries within the eu have introduced or contemplated unilateral taxes to reduce anthropogenic co2emissions taxes which are unilaterally imposed in an open economy can have significant impacts on production and employment of energy and export intensive industries to save jobs by maintaining international competitiveness most co2taxation schemes include exemptions for energy and export intensive industries as a compromise between environmental objectives and employment in these sectors this paper shows that such compromises are costly as the tax base narrows the dead weight loss increases our calculations illustrate this point in the framework of a static general equilibrium model for west germany calibrated to 1990 data we evaluate the excess costs of exemptions as a means of saving jobs in specific industries relative to an alternative instrument a uniform carbon tax cum wage subsidy which achieves an identical level of national emissions and employment at a fraction of the cost