Taxes, subsidies, regulation in dynamic models

Taxes, Subsidies and Equilibrium Labor Market Outcomes

We explore the effects of taxes and subsidies on job creation, job destruction, employment, and wages in the Mortensen-Pissarides version of the search and matching equilibrium framework. Qualitative analytical results show that wage and employment subsidies increase employment, especially of low skill workers, and also increase wages. A job creation or hiring subsidy reduces unemployment durat...

Petroleum Taxes: Trends in Fuel Taxes (and Subsidies) and the Implications

In 2000 the price of crude oil rose to levels not seen for more than 20 years, and as a result so did the price of oil products. The price hikes prompted public debate about the level of taxes determining the final prices paid by consumers. By one estimate, taxes accounted for 68 percent of the final price in the European Union in 2000 (OPEC 2000). But what about developing countries, where pet...

Primer on Fat Taxes and Thin Subsidies: A Graphical Analysis

Taxes, Social Subsidies and the Allocation of Work Time

We examine the allocation of hours of work across industrial sectors in OECD countries. We find large disparities across three sector groups, one that produces goods without home substitutes,and two others that have home substitutes but treated differently by welfare policy. We attribute the disparities to the countries’ tax and subsidy policies. High taxation substantially reduces hours in sec...

Taxes, subsidies and unemployment - a unified optimization approach

Like a linear programming (LP) problem, linear-fractional programming (LFP) problem can be usefully applied in a wide range of real-world applications. In the last few decades a lot of research papers and monographs were published throughout the world where authors (mainly mathematicians) investigated different theoretical and algorithmic aspects of LFP problems in various forms. In this paper ...