the compliance cost of itemizing deductions evidence from individual tax returns the resource cost of operating the income tax system is large totaling as much as seven to eight percent of revenue raised one source of this cost is the system of itemized deductions which can require extensive record keeping and calculation this paper estimates the resource cost of itemizing deductions in contrast to previous studies of compliance cost which rely an survey evidence we infer this evidence from data reported on tax returns which suggest that there exists taxpayers who would save money by itemizing but who choose not to we find that in 1982 the private cost of itemizing totaled 1 44 billon or 43 per itemizing taxpayer the compliance cost dissuaded from itemizing aver 650 000 taxpayers who would have thereby saved taxes causing an extra tax liability of nearly 200 million increasing the standard deduction by 1 000 would save 100 million in resources that would otherwise have been devoted to itemizing this abstract was borrowed from another version of this item

devaluation and the j curve some evidence from ldcs within the international trade literature it is not uncommon to find arguments about whether devaluation will improve the trade balance it is argued that the flows of goods respond only with time lags to changes in the exchange rate the j curve terrn is used to describe the movement over time of the trade balance it may deteriorate at first and improvement may come later this paper presents a method by which one could detect the existence of the j curve the method is applied to four developing countries the empirical evidence supports the pattern of movemnent described by the j curve a major policy option for a country facing a persistent balance of payments deficit is said to be devaluation of its currency within the international trade literature it is not uncommon to find arguments about whether devaluation will improve the trade balance or the balance of payments for example proponents of the elasticities approach describe the necessary and sufficient conditions for an improvement in the trade balance in terms of elasticities of demand and supply referred to as the marshall lerner condition while there is abundant empirical evidence to suggest that these conditions are indeed met at least for industrial countries there have been circumstances under which 2 devaluation has not been successful for example one might wonder why the u s trade balance deteriorated so much in 1972 despite the devaluation of the dollar in 1971 this unfavorable effect of devaluation on the trade balance is termed the j curve phenomenon received for publication august 23 1984 revision accepted for publication november 26 1984 the university of wisconsin milwaukee i would like to thank two anonymous referees for their valuable comments on the initial draft of this paper 1 proponents of the absorption approach e g alexander 1952 describe how devaluation may change the terms of trade increase production and switch expenditures from foreign to domestic goods thus improving the trade balance international monetarists argue that devaluation reduces the real value of cash balances and or changes the relative price of traded and nontraded goods thus improving both the trade balance and the balance of payments 2 for an cstimate of the elasticities see houthakker and magee 1969 and warner and kreinin 1983 the former study provides the elasticities estimates under fixed exchange rates and the latter under floating rates this content downloaded from 157 55 39 17 on wed 31 aug 2016 04 39 37 utc all use subject to http about jstor org terms

empirical investigation of one opec country s successful non oil export performance abstract this study examines indonesian non oil export success between 1975 and 1994 with a focus on the role of exchange rate management and trade policy in export performance across sectors to examine the link between export quantity and changes in policy i estimate structural export supply functions that are derived from utility and profit maximization behavior the results indicate that non oil exporters respond positively to improved price incentives including exchange rate devaluation with the strongest impact in textiles garments and sawnwood the study offers a richer description than previous work of the relationship between price incentives and export performance

effects of exchange rate risk on exports crosscountry analysis abstract in this paper we investigate the effects of exchange rate uncertainty on the aggregate exports of 19 developed and 67 developing countries using cross sectional data exchange rate uncertainty is found to be detrimental to the exports of both developing and developed countries developed countries exports however are found to be less sensitive to exchange risk than that of developing countries furthermore within the developing countries those who fixed their exchange rates to one major currency were found to be subject to less risk than the other developing countries

determinants of international trade flows this paper models and estimates import demand and demand for export functions for 19 industrial countries although primary emphasis is placed on the period of generalized floating exchange rates 1972 through 1980 estimates are also provided for the fixed exchange rate years 1957 1970 thus making possible a comparison between the two eras aside from the conventional income and price variables the paper assesses the effect of variations in the exchange rate and in the expected exchange rate on real trade flows additionally it estimates an unrestricted lag structure of the effect of price and exchange rate variations on imports

efficiency and surplus bounds in cournot competition we derive bounds on the ratios of deadweight loss and consumer surplus to producer surplus under cournot competition to do so we introduce a parameterization of the degree of curvature of market demand using the parallel concepts of concavity and convexity the more concave is demand the larger the share of producer surplus in overall surplus the smaller is consumer surplus relative to producer surplus and the lower the ratio of deadweight loss to producer surplus deadweight loss over total potential surplus is at rst increasing with demand concavity then eventually

long run price elasticities and the marshall lerner condition revisited abstract in estimating trade elasticities most previous researchers employed nonstationary data and ols or 2sls method with new developments in the literature this paper uses stationary data and johansen s cointegration analysis to provide new trade elasticities for almost 30 countries

bilateral j curve between india and her trading partners india a land of over one billion people and one of the newly emerging industrial powers in the world is going through a slow but steady metamorphism for centuries india has played a major role in the international trade it was not uncommon to see her ships carrying silk and spices across the arabian seas and bringing back machine made textile invasions of india first by mughals and latter by the british through the east india company were all trade oriented india s presence in the world trade is relatively small at this time but is gaining momentum after independence in 1947 india for a brief period experimented with socialism the five year plans were mainly focused towards building infrastructure and development of small scale agriculture based industries the industrial development even though extremely important for growth played a secondary role the foreign investment was encouraged but only in the selected sectors of the economy however threat of nationalization a large bureaucracy corruption lack of understanding of the indian business practices and the requirement that a major share holder must be an indian national discouraged foreign capital investment in india during 1991 1992 india adopted a policy of trade liberalization to attract foreign capital and to encourage non resident indians to invest in their home country government of india established a separate unit within the home ministry whose main function was to expedite processing of applications india also relaxed the requirement that a major partner be an indian national india provided export subsidies to the exporters in terms of cash as well as foreign exchange so that they could import machines and raw materials exports responded to the trade liberalization and increased from 44 041 crores of rupees in 1991 1992 to 141 603 crores in 1998 1999 where one crore is equivalent to ten million in us dollar terms at a current exchange rate of 42 48 rupees per dollar this translates to an increase from 10 37 billion to 33 34 billion over eight years india also anticipates that through a major increase in the information technology mainly software industry her exports will increase to 90 billion by 2005 the trade liberalization has been accompanied by changes in the monetary policies the inflation rate has been reduced from about 12 to 9 per year the interest rates have declined from 14 to 10 and the exchange rate has been allowed to respond to market forces as a result from 1991 1992 to 1998 1999 the rupee has declined from 19 62 rupees per dollar to 42 48 rupees per dollar by december 2000 rupee had further devalued to 46 25 per dollar with a hope that it will further boost india s exports and improve her trade balance however the impact of currency depreciation on the trade balance is not instantaneous indeed there is ample evidence in the literature that after currency depreciation the trade balance worsens in the short run before improving in the long run since this pattern of movement of the trade balance over time resembles the letter j magee 1973 labelled it the j curve phenomenon magee argued that after devaluation contracts that are in transit at old exchange rates dominate the short run response of the trade balance over time new contracts at new prices begin to exert their favourable impact at this stage elasticities may increase leading to an eventual improvement in the trade balance of course the delayed response could also be due to lags in the process of increasing the production of exportables junz and rhomberg 1973 have identified five lags namely recognition lags decision lags delivery lags replacement lags and production lags only after the realization of these lags the trade balance could improve early studies that tried to investigate the impact of currency depreciation on the trade balance relied upon estimating the marshall lerner condition the condition

what can we learn from a large border effect in developing countries abstract failure of the law of one price lop in the short run is an empirical regularity recent research using disaggregated price data for different cities across an international boundary has shown that the variation of the prices in equidistant cities located in two different countries is systematically larger than that for the cities within the same country nontariff barriers and exchange rate variability are cited as the proximate causes of this systematic difference in consumer price variability results using data from developing countries with large nontariff barriers and more volatile exchange rate suggest that those claims are overemphasized

an econometric analysis of income tax evasion and its detection this article presents an econometric analysis of income tax evasion and its detection based on individual level data drawn from the internal revenue service 1982 and 1985 taxpayer compliance measurement programs i specify a model consisting of two equations the first measures the extent of evasion the second the fraction of evasion detected the empirical analysis explores the effects of income the marginal tax rate and various socioeconomic characteristics on filer evasion behavior and it assesses the variability in detection rates among irs examiners finally i use the empirical estimates to construct new estimates of the income tax gap the new estimates are very close to the previous irs estimates

brazil us commodity trade and the j curve currency devaluation or depreciation is said to temporarily worsen a country s trade balance and improve it later an effect that is called the j curve previous research that tested the j curve for brazil used the country s aggregate trade flows with the rest of the world and did not find support for the phenomenon in this article we consider the trade flows between brazil and a major trading partner the united states disaggregating their trade flows by commodity we then test the empirical validity of the j curve for each of the 92 industries that trade between the two countries we find support for the phenomenon in 31 industries therefore disaggregation by industry seems to yield some support for the phenomenon

individual morality and reputation costs as deterrents to tax evasion abstract empirical evidence suggests some taxpayers never evade evasion increases with the tax rate and evasion decisions are interdependent these findings are not easily explained by the existing theory which models evasion as an independently made amoral gamble this paper uses nonpecuniary costs of evasion to reconcile theory with evidence once individuals are assumed to differ by an honesty characteristic taxpayers dichotomise into groups the more honest of which responds to a tax change as the evidence suggests a further extension is to introduce an endogenous reputation cost this suggests a positive relationship between the number of evaders and the tax rate

determinants of international trade flows the case of developing countries abstract the question of magnitude and the time path of the trade flows to changes in the exchange rates and to changes in the price level is of emitent practical importance to assess the above proposition a distributed lag structure is imposed on the relative prices and on the effective exchange rate as the determinants of trade flows then import and export demand functions are estimated for a sample of developing countries using the almon procedure the empirical findings appeared to sustain orcutt s early conjecture that trade flows adjust differently to different price stimuli more precisely it was found that imports and exports reactions were quicker and the total response time was shorter when an exchange rate rather than relative prices caused a change in international prices

kalman filter approach to estimate the demand for international reserves a few studies have provided empirical support for the fact that the demand for international reserves experienced structural instability in 1973 and 1979 due to a change in exchange rate system and oil price shocks thus under the current managed float due to exchange rate and oil price fluctuations coefficient estimates could be time dependent after showing that indeed estimated coefficients are time dependent the kalman filter estimation method is employed and the reserve demand function for 19 industrial countries estimated the kalman filter approach incorporates the time varying properties of coefficients estimates

will developing country debt forgiveness increase agricultural trade abstract latin american countries are important customers in international agricultural trade however between 1981 and 1987 u s agricultural exports to these countries declined by almost 50 one explanation for the above decrease is the change in financial conditions facing many countries in this region outstanding debt in the latin american countries continued to rise through the 1980 s reaching over 120 billion for brazil and mexico by 1987 in this paper we develop an import model which considers the effect of the debt crisis on the ability of developing countries to purchase agricultural commodities in world markets we estimate the model for four countries mexico brazil chile and venezuela the estimated results are used in a simulation model to obtain the effects of a 50 debt forgiveness scenario results indicate only a modest improvement in agricultural imports of the four latin american countries considered in this study these four countries would expand agricultural imports by 400 million per annum given the debt reduction

effects of exchange rate flexibility on the demand for international reserves abstract we incorporate a measure of exchange rate flexibility into the standard reserve demand equation and present empirical results for the 1976 1985 period which are consistent with the work of officer 1976 and frenkel and jovanovic 1981 indicating the existence of economies of scale and the demand for reserves

health utility indices and equity considerations the aim of this paper is to propose methods that incorporate equity concerns into cost utility analysis the focus of the paper is on qalys but the results apply to health utility indices in general two interpretations of qalys are considered qalys as von neumann morgenstern utilities and qalys as measures of health a justification is provided for aggregating consistently scaled qalys as utilities over individuals the conditions underlying unweighted aggregation of qalys are identified these conditions exclude two common types of equity concern algorithms are proposed that take into account equity concerns and that are relatively easy to apply

the design of direct taxation and family benefits abstract the subject of this paper is the design of the personal income tax and social security benefits that vary with the size of the family it is concerned with the analytical problems of policy design that arise from constraints on the instruments which may be used from differences in social judgements about the desirability of redistribution and from differences of view about the disincentive effects of taxation the paper considers these issues in the context of the french tax benefit system and the implications of the french system being harmonised towards certain features of the british system

trade liberalisation the peso and mexico s commodity trade flows with the united states abstract we assess the effects of real peso devaluations as well as the effects of gatt and nafta on mexico s in payments and out payments with the united states for 102 industries we find that relatively few trade flows are sensitive to changes in the real exchange rate probably due to production sharing and intra industry trade but devaluations affect mexican imports more than exports trade liberalisation has had a larger impact particularly on imports of intermediate goods and exports of certain manufactures many affected export industries are ones that have previously been shown to have economies of scale

the j curve a literature review due to lag structure currency devaluation is said to worsen the trade balance first and improve it later resulting in a pattern that resemble the letter j hence the j curve phenomenon since its introduction by magee in 1973 brooking papers on economic activity 1 pp 303 25 a large number of studies have attempted to test the phenomenon using different techniques and different model specifications the results are at best ambiguous and deserve to be collected together for the future generation of researchers and graduate students this paper fills such a vacuum in the literature by reviewing the j curve related empirical papers

income distribution and equilibrium multiplicity in a stigma based model of tax evasion abstract this paper incorporates continuous income distribution into the stigma based model of tax compliance the paper investigates the effect of income distribution on the existence of multiple equilibria and characterizes the conditions under which multiple equilibria emerge precisely multiple equilibria exist if taxpayer incomes are sufficiently homogeneous because the social coordination effect dominates the individual characteristics effect numerical simulations show that the main proposition is robust to allowing two step audit policies on the part of the tax agency under the presumption that the best or good equilibrium is selected whenever there are multiple equilibria as a byproduct the effect of various forms of tax reforms on the optimal two step audit policy the equilibrium compliance and fiscal revenue is analyzed

optimal top marginal tax rates under income splitting for couples abstract this paper provides formulas for optimal top marginal tax rates when couples are taxed according to income splitting between spouses consumption is taxed and the skill distribution is unbounded optimal top marginal income tax rates are computed for germany using a dataset that includes the tax returns of all german top taxpayers we find that the optimal top marginal tax rate converges to about 2 3 and convergence obtains at income levels that are substantially higher than those currently subject to the actual top tax rate

inequality reducing properties of composite taxation abstract on the one hand we know that the more progressive a tax schedule the more equally distributed the after tax incomes u jakobsson j public econ 5 1976 161 168 on the other hand most tax systems involve a complex procedure where individual incomes are successively subjected to different rounds of taxation we study in the paper the inequality reducing properties of the composition of different taxation schemes and we identify necessary and sufficient conditions for after tax inequality to decrease when the degree of progressivity of one element or more of the tax system is increased for the sake of generality we assimilate the set of income distributions with the space of probability measures over an interval of the real line and any function that associates after tax incomes to before tax incomes is viewed as a taxation scheme this general approach proves to be particularly powerful when investigating the restrictions the egalitarian principle imposes on the set of admissible taxation schemes journal of economic literature classification numbers d31 d63 h24

effects of exchange rate variability on inflation variability abstract previous studies have postulated that there exists a positive relationship between the rate of inflation and its variability they have shown that a high inflation rate contributes to inflation variability in this paper we argue that with the current floating exchange rate system exchange rate variability is another factor contributing to inflation variability after incorporating a measure of exchange rate variability into a simple model used by previous authors we estimate our model using cross country data from 20 developed and 76 less developed countries the cross sectional regression results support our conjecture

on income tax avoidance the case of germany abstract we present a micro estimate determining taxed income as a function of gross income and all major deduction options depending on household and asset categories it shows that tax savings strongly increase with increasing income resulting in an effective marginal tax rate 16 percentage points below the legislated one for the highest income groups this calls into question the intended distributional impact of progressive income taxation our estimate suggests aggregate income tax losses to the german fiscal authorities in the order of magnitude of 34 of wage and income taxes paid in 1983 relative to 1994 tax proceeds this percentage would amount to dm 105 b

asymmetric size dependent effects of the output gap on inflation us evidence from the last half a century this article examines asymmetric size and sign dependent effects of the output gap on the us quarterly inflation rate using data from the last half a century 1959q2 2013q1 consistent with previous studies it is found that the consumer price index is cointegrated with the unit labour cost and the price of oil a short run dynamic model is then estimated in which variations in the output gap are divided into three groups large positive large negative and small medium positive negative the results provide convincing evidence that only sufficiently large positive or negative variations of the output gap can significantly influence inflation put otherwise relatively small to medium changes in the output gap exert no significant impact on inflation and if not separated they can somewhat obscure the significant effects associated with large variations of the output gap this study can lead to greater consensus on the inflation output gap nexus the findings remain robust despite the use of differen

corruption in tax administration abstract we extend the game theoretic model of graetz reinganum and wilde 1986 to allow for corruption in tax administration in the presence of corruption audit rates are generally higher than in its absence in fact in the presence of corruption it is possible to sustain equilibria in which all returns are audited moreover when some auditors accept bribes it is possible for increases in the fine rate or the tax rate to reduce expected government revenue

a general characterization of optimal income tax enforcement this paper develops a general approach to characterizing optimal income tax and enforcement schemes our analysis clarifies the nature of the interplay between tax rates audit probabilities and penalties for misreporting in particular it is shown that for a variety of objective functions for the principal the optimal tax schedule is in general concave at least weakly and monotonic the marginal tax rates determine the audit probabilities and less harsh penalties lead to higher enforcement costs our results imply that there exists a tradeoff between equity and efficiency considerations in the enforcement context which is similar to that in the moral hazard context for tax policy it is well accepted by now that informational asymmetries generate important constraints on the formulation of economic policy an early and classic example is given by mirrlees 1971 who considers the problem of optimal income taxation when individuals differ in their ability to transform effort into income it is assumed that ability and effort of an individual cannot be observed at any cost whereas income which is the product of these two unobservables is perfectly and costlessly observable taxes can thus depend only on final income under these informational conditions the equity efficiency tradeoffs that constrain the choice of tax policy arise only because of the presence of moral hazard associated with taxation of income if there were no moral hazard i e individual efforts and therefore incomes were exogenous the problem of optimal income taxation would be a trivial one since by assumption individual incomes are perfectly and costlessly observable in much of the recent literature on optimal income taxation in the presence of costly enforcement reinganum and wilde 1985 border and sobel 1987 and others on the other hand individual incomes are treated as exogenous i e there is no moral hazard however informational constraints arise from another important consideration namely an individual s income cannot be directly observed it can only be verified through a costly

the demand for tax haven operations what types of firms establish tax haven operations and what purposes do these operations serve analysis of affiliate level data for american firms indicates that larger more international firms and those with extensive intrafirm trade and high r and d intensities are the most likely to use tax havens tax haven operations facilitate tax avoidance both by permitting firms to allocate taxable income away from high tax jurisdictions and by reducing the burden of home country taxation of foreign income the evidence suggests that the primary use of affiliates in larger tax haven countries is to reallocate taxable income whereas the primary use of affiliates in smaller tax haven countries is to facilitate deferral of u s taxation of foreign income firms with sizeable foreign operations benefit the most from using tax havens an effect that can be evaluated by using foreign economic growth rates as instruments for firm level growth of foreign investment outside of tax havens one percent greater sales and investment growth in nearby non haven countries is associated with a 1 5 to 2 greater likelihood of establishing a tax haven operation

inflationary effects of changes in effective exchange rates ldcs experience the inflationary effects of devaluations in less developed countries is investigated using rate of change of effective exchange rates it is shown that for most countries in the sample devaluations or depreciations are inflationary during the current floating exchange rate system in addition to inflationary effects of depreciations excees money supply imported inflation and expectation are also identified as additional sources of inflation in less developed countries

rational conjectures in the theory of oligopoly abstract the paper employs the notion of rational conjectural equilibrium to remove the arbitrary nature of conjectures about rivals reactions which characterises the traditional non cooperative theory of oligopoly a general definition of these equilibria is given and the concept is then applied to a simple duopoly model the standard models of perfect competition monopoly limit price dominant firms are shown to emerge as special cases of rational conjectural equilibria

tax progressivity income distribution and tax non compliance this article examines the determinants of tax non compliance when we recognise the existence of an imperfectly competitive tax advice industry supplying schemes which help taxpayers reduce their tax liability we apply a traditional industrial organisation framework to model the behaviour of this industry this tells us that an important factor determining the equilibrium price and hence the level of noncompliance is the convexity of the demand schedule we show that in this context this convexity is affected by the distribution of pre tax income the progressivity of the tax schedule and the way in which monitoring and penalties vary with income it is shown that lower pre tax income inequality as well as a less progressive tax code may cause more tax minimisation activities therefore the frequently advocated policy of reducing the highest tax rate may fail as a policy directed at improving tax discipline one way of offsetting the possible harm to tax compliance from a less progressive tax could be an adjustment of the penalty and monitoring functions

dispersive equity and social risk dispersive equity is concerned with the impact of life threatening risks from alternative policy decisions on homogeneous groups in a population it is not addressed to the disutility of various numbers of fatalities that might occur but rather to how fatalities are distributed over the groups although dispersive equity has long been recognized as an important component of some policy decisions it has received little formal treatment within the matrix of salient factors for such decisions our purpose is to advance its formal development this is done within a formulation based on probability distributions over potential fatality sets the formulation gives rise to four distinct but not independent equity concepts individual risk equity group risk equity dispersive equity and social outcome equity each of these is analyzed but special attention is given to dispersive equity the paper also comments on relationships between total equity and its four components and between total equity and the dis

trade flows relative prices and effective exchange rates a var on ethiopian data the dynamic response of trade flows to price and effective exchange rate changes is examined via var using quarerly data from ethiopia for the period 1973 i 1985 iv the results show one way granger causality running from prices and exchange rates to imports and exports without significant feedback imports and exports exhibit similar response patterns to unexpected changes in relative prices and exchange rates the responses of imports and exports are larger and the adjustment takes longer when relative prices rather than exchange rates caused a change in international prices in the long run changes in prices account for a larger percentage of the forecast error variances in imports and exports than exchange rate changes it is shown that devaluation may have an initial adverse effect on the trade balance

the effectiveness of foreign exchange interventions under a floating exchange rate regime for the turkish economy a post crisis period analysis the reported study has two purposes first it attempts to improve the literature on foreign exchange interventions of the central banks for the emerging market economies an area not previously studied in detail the turkish economy in the post crisis period constitutes a good example in this context second it proposes a new methodology a time varying parameter model to analyse the effectiveness of the foreign exchange interventions when the results from such an exercise are compared with those obtained from an event study analysis it is found that purchase based interventions seem to be successful especially after stabilization of the financial markets in that sense an asymmetry is detected regarding the effectiveness of interventions concerning the relationship between interest rates and exchange rates it is found that the uncovered interest rate parity condition operates in an unconventional way supporting the views put forward by recent emerging markets literature

taxation with representation abstract in this paper a framework is developed for the joint analysis of tax preparation mode and tax non compliance estimation is performed using micro level audit data from the internal revenue service although tha availability of tax practitioners undoubtedly reduces many of the informational and computational barriers to tax compliance the results indicate that their use particularly the use of cpas and attorneys is associated with increased tax non compliance which may have negative implications for both tax equity and tax efficiency

honesty and evasion in the tax compliance game conventional models of tax compliance emphasize that taxpayers make strategic tax reports underreporting income to the extent that this behavior is functionally rewarded in contrast to this view considerable empirical evidence suggests that many taxpayers are inherently honest reporting truthfully regardless of the incentive to cheat in this article we build a game theoretic model of tax compliance that includes both honest and potentially dishonest taxpayers we show that including honest taxpayers significantly alters the model leading to much improved empirical predictions and somewhat different and novel policy implications

tax reform and progressivity the established theory of tax progressivity cannot handle basic tax reform questions such as whether an increase in personal allowances makes the tau system more progressive because the core results assume that tax liability is never zero this paper generalises the core theory to allow for zero tax payments and applies the new framework to the analysis of allowances income related deductions and tau credits log concavity of the tax schedule a property quite distinct from any existing notion of progressivity emerges as the critical determinant of whether the distribution of die tau burden becomes more progressive as allowances are increased

conjectural variation and the indeterminancy of duopolistic equilibria the purpose of this article is to investigate the basic premise that the various oligopoly models result in an unacceptable divergence in market equilibria in the first half of the paper a theoretical model of a static conjectural variation duopoly with symmetric costs is presented using this model we define the coefficient of dispersion of equilibria and show that it is solely a function of the basic conditions of the market costs and demand this result is of empirical significance because it is possible to determine ex ante from easily observable information the extent to which conjectural variation market conduct will influence market equilibrium variation conjecturale et indetermination des equilibres duopolistiques l objectif de cet article est d analyser la proposition fondamentale que les divers modeles d oligopole se resolvent en une divergence inacceptable d equilibres de marche dans la premiere partie du m6moire on presente un modele theorique de duopole avec variation conjecturale statique et couits symmetriques avec l aide de ce modele on definit le coefficient de dispersion des equilibres et on montre qu il est seulement fonction des conditions du marche cofits et demande ce resultat a une importance empirique significative parce qu il devient possible de determiner ex ante a partir de renseignements facilement observables jusqu a quel point la variation conjecturale la conduite sur le marche va influencer l equilibre du marche

tax arbitrage and labor supply we examine how tax avoidance in the form of trade in well functioning asset markets affects the basic labor supply model we show that tax arbitrage has dramatic implications for positive normative and econometric analysis of how taxes affect work incentives

taiwan s exports and trade imbalance against us and japan an empirical analysis the persistence of the bilateral trade surplus between taiwan and the usa and the bilateral trade deficit between taiwan and japan despite the significant appreciation or depreciation of the nt dollar during the early 1980s to the mid 1990s renewed interest to seek explanations for these phenomena to assess the above proposition a polynomial distributed lag pdl method is imposed on the impact of changes in the real exchange rate on the bilateral trade structure particularly export demand and trade imbalance between taiwan the usa and japan from 1981 to 1998 the empirical findings show that 1 the real income factors have important effects on the real exports in both cases 2 the real exchange rates and the real imports are not major determinants of the export demand from taiwan to the usa but they do play an important role on the real exports from taiwan to japan 3 the real exchange rate has significant effect on the real trade surplus with the usa and on trade deficit with japan but the real

is there a long run relation between the trade balance and the real effective exchange rate of ldcs abstract using quarterly data over 1973 1988 period the cointegration analysis is used and it is shown that the trade balance and the real effective exchange rate of some ldcs are cointegrated in the long run this approach is argued to be a close substitute for testing the marshall lerner condition

equity considerations in public risks evaluation recent contributions by r k sarin and r l keeney and r l winkler approach the problem of public risks evaluation from a multiattribute perspective in which fatalities ex ante equity and ex post equity play leading roles the present paper considers the same problem from the perspective of holistic comparisons between potential fatality distributions we consider a number of axioms for such comparisons identify maximally compatible sets of axioms and relate our approach to the multiattribute approach we also identify a form of dispersive equity that is not discussed in recent work but deserves further consideration

two remarks on cournot equilibria abstract we describe two simple results in the theory of cournot equilibria the first has to do with the effect of taxation in a cournot industry and the second describes under what conditions a cournot equilibrium will implicity maximize an objective function these results are probably known but are not well known and they seem useful enough to be worth spelling out

tax avoidance and the deadweight loss of the income tax traditional analyses of the income tax greatly underestimate deadweight losses by ignoring its effect on forms of compensation and patterns of consumption the full deadweight loss is easily calculated using the compensated elasticity of taxable income to changes in tax rates because leisure excludable income and deductible consumption are a hicksian composite good microeconomic estimates imply a deadweight loss of as much as 30 of revenue or more than ten times harberger s classic 1964 estimate the relative deadweight loss caused by increasing existing tax rates is substantially greater and may exceed 2 per 1 of revenue

exchange rate volatility and pakistan s exports to the developed world 1974 85 abstract the paper attempts to estimate the impact of exchange rate uncertainty on pakistan s exports to the developed world for 1974 85 discovering strong evidence to suggest that exports were adversely affected by the increased variability of its bilateral exchange rates unlike much of the recent evidence on developed countries however it is the variability in nominal rather than real exchange rates that is significant the computations also suggest the presence of strong third country effects

corruption extortion and evasion corruption evasion and the abuse of power and the possibility thereof are pervasive features of economic activity a prominent instance is tax collection this paper examines the implications of corruptibility and the potential abuse of authority for the effects and optimal design of potentially non linear tax collection schemes amongst the findings are that the distributional effects of evasion and corruption are unambiguously regressive under the kinds of schemes usual in practice and collecting progressive taxes without inducing evasion or corruption may require that inspectors be paid commission on high income reports but not on low with the cost of this potentially creating what seems to be a previously unnoticed trade off between equity and efficiency

foreign exchange reserves and import demand evidence from latin america this paper investigates the impact of foreign reserves domestic real income and relative import prices on import demand for seven latin american countries we differentiate empirically between the short run and long run impact of reserves income and prices on imports the paper has three main results first we show that there exists a unique long run relationship among real imports real income relative import prices and real foreign exchange reserves for all seven countries second we find that increases in foreign exchange reserves exert a significant positive effect on import demand in both the long run and the short run in all countries however the economic impact of foreign exchange reserves is rather small finally we find that the long and short run impact of real domestic income on import demand is positive as well while the effect of relative prices is negative

technical note equity in risk bearing von neuman morgenstern utility functions are found incompatible with valuing fairness and lead to an invalid conclusion about risk proneness

emerging markets and heavy tails abstract emerging countries are held to be subject to more frequent and more pronounced external and internal shocks than their developed counter parts this suggests that key variables pertaining to their markets including their exchange rates will be marked by greater likelihood of extreme observations and large fluctuations we focus on the hypothesis that compared to developed country exchange rates emerging country exchange rates will be more pronouncedly heavy tailed we find support for the hypothesis using recently proposed robust tail index estimation methods which in particular perform well under heavy tailed dependent garch processes that are often used for modeling exchange rates according to the estimation results reported in the paper variances may be infinite for several emerging country exchange rates tail index values p 2 6 2 8 appear to be at the dividing boundary between the two sets of countries while the moments of order p 2 6 2 8 are finite for most of the developed country exchange rates they may be or are infinite for most of the emerging country exchange rates we also study the impact of the on going financial and economic crisis and find that heavy tailedness properties of most exchange rates did not change significantly with the onset of the crisis at the same time some foreign exchange markets have experienced structural changes in their heavy tailedness properties during the crisis

exchange rate sensitivity of the demand for money in developing countries there is consensus among researches that under the present floating exchange rate system although developing countries peg their exchange rate to a major currency they cannot avoid fluctuation in their effective exchange rates as long as major currencies fluctuate against one another few authors have investigated the effects of changes in effective exchange rates of developing countries on their imports exports trade balance demand for international reserves inflation etc in this paper we try to inestigate the effects of effective exchange rates of developing countries on their demand for money previous authors who have estimated a money demand function inclusive of an exchange rate variable bilateral or effective have restricted themselves to industrial countries only by using quarterly data over the 1973 85 period it is shown that in most developing countries while the short run effcts of depreciation could be in either direction its long run effects are negative indicating that deprecia

the political economics of not paying taxes this paper considers redistributive as well as political consequences of tax avoidance when tax avoidance is possible the official tax rate does not necessarily correspond to what individuals actually pay this affects both redistributive outcomes as well as political attitudes towards taxation depending on the avoidance technology different political equilibria emerge when the avoidance possibilities are limited the classical conflict between rich and poor is sustained if the tax avoidance technology is more effective however the equilibrium outcome can change to a situation where a coalition of poor and the very richest favor a higher tax rate comparing the model predictions with data on income inequality and evidence of avoidance activity it comes surprisingly close to actual observations

price instability and inflation the latin american case abstract this paper provides empirical evidence substantiating the existence of an over time relationship between inflation and price variability for 23 latin american countries by employing a novel measure of price instability based on price expectations

tax morale in latin america in the tax compliance literature there is a lack of empirical evidence on the degree of tax morale in developing countries as a novelty this paper focuses thus on latin america analysing tax morale as a dependent variable and searching for factors that systematically affect tax morale working with the two data sets latinobarometro and world values survey our findings indicate that there is a significant correlation between tax morale and the size of shadow economy furthermore people who said they knew have heard about practised tax avoidance have a significantly lower tax morale than others looking at individuals perception of reasons for tax evasion we found that the tax burden lacking honesty and corruption are seen as the main factors we observed a significantly lower tax morale in south america mexico than in the central american caribbean area furthermore trust in the president and the officials the belief that other individuals obey the law and a pro democratic attitude have a significant positive effect on tax morale

nominal and real effective exchange rates of middle eastern countries and their trade performance indexes of real and nominal effective exchange rates that are published by the imf are mostly for industrial countries none of the middle eastern countries have received any attention on this regard this paper tries to close the gap by constructing such indexes for 11 middle eastern countries over 1971 i 1994 iv period as an application long run response of their trade balance to devaluation is also investigated

tax evasion under differential taxation the economics of income source misreporting abstract if different income sources are subject to different rates of taxation a taxpayer may find it worthwhile to evade taxes by declaring part of his higher taxed income as stemming from a lower taxed source this paper inquires into the determinants of income source misreporting focusing on the relationships between misreporting and taxation under alternative penalty schemes allowing the taxpayer the choice between source misreporting and pure underreporting the paper examines also the relative amount of tax escaping the tax collector through the alternative forms of evasion and determines the conditions under which one will be preferred to the other

voting inequality and redistribution this paper surveys models of voting on redistribution under reason able assumptions the baseline model produces an equilibrium with the extent of redistributive taxation chosen by the median income earner if the median is poorer than average redistribution is from rich to poor and increasing inequality increases redistribution however under different assumptions about the economic environment redistribution may not be simply rich to poor and inequality need not increase redistribution several lines of argument are presented in particular political participation public provision of private goods public pensions and tax avoidance or evasion

bargaining versus posted price selling abstract two popular selling methods bargaining and posted price selling are compared here in a dynamic model when bargaining costs no more than posted price selling we find that bargaining is always optimal when bargaining costs more however bargaining is still preferred if and only if the common cost for both selling methods is large enough we also find that an increase in the discount rate or the seller s bargaining power favors bargaining finally we find that if the distribution becomes more dispersed and the increase in a buyer s valuation is sufficiently large bargaining is more likely to be adopted