The Ricardian Nonequivalence Theorem

Equivalence and nonequivalence of the . . .

Conditions on Ramsey Nonequivalence

Given a graph H, a graph G is called a Ramsey graph of H if there is a monochromatic copy of H in every coloring of the edges of G with two colors. Two graphs G, H are called Ramsey equivalent if they have the same set of Ramsey graphs. Fox et al. [J. Combin. Theory Ser. B 109 (2014), 120–133] asked whether there are two nonisomorphic connected graphs that are Ramsey equivalent. They proved tha...

Matching grants and Ricardian Equivalence

This paper investigates the effectiveness of matching grants to correct for interjurisdictional spillovers in the light of Bernheim general neutrality result. Indeed this result suggests that the usual argument that matching grants are needed to internalize the externality arising from the existence of interjuridictional spillovers is an artifact of the assumption that jurisdictions neglect the...

Ricardian Consumers with Keynesian Propensities

This paper examines Ricardian equivalence in a world in which taxes are not lump sum, but are levied on risky labor income. It shows that the marginal propensity to consume out of a tax cut, coupled with a future income tax increase, can be substantial under plausible assumptions. Indeed, the MPC out of a tax cut can be closer to the Keynesian value that ignores the future tax liabilities than ...

Offshoring in a Ricardian World †

Technological change has led to a dramatic decline in the cost of communication and in the cost of coordinating activities performed in different locations. This has allowed firms in rich countries to fragment their production process and offshore an increasing share of the value chain to low-wage countries. 2 Richard Baldwin (2006) refers to this phenomenon as the “second unbundling.” In his w...