High income concentration and poverty in Brazil have been intensively studied by many researchers, suggesting that an obvious factor influencing unequal earnings in the country is the heterogeneous level of education in the labor force; for education can be understood as a mean to attain improvements in labor productivity and consequently in family income. The present study aims to construct a ...

The paper assumes a continuum of two period-lived agents; agents are identical except for the inherited income. Young agents optimally allocate their inherited income between consumption and investment in human capital in a stochastic environment. In the second period they receive a wage proportional to the accumulated human capital and invest in o®spring. Two main results are provided: a low e...

The goal of this paper is to determine the nature of the causal relationship between "social capital," as measured by household membership in formal and informal groups and household welfare in South Africa. Using a recently collected panel data set in South Africa's largest province, we estimate per capita expenditure functions and find a positive and significant impact of household-level soci...

I add intangible capital to a variant of the neoclassical growth model and study the implications for cross-country income differences. I calibrate the parameters associated with intangible capital by using new estimates of investment in intangibles by Corrado et al. (2006). When intangible capital is added to the model, the TFP elasticity of output increases from 2.14 to 2.64. This finding imp...

Abstract: Some scholars of the Interwar Debate on Socialism argue that the trial and error method developed by Taylor (1929), Lange (1938), and Dickinson (1939) proved that socialism could match or outperform capitalism. Other scholars argue that the trial and error method of simulating markets was an illegitimate compromise between true socialism and capitalism. The market socialists failed to...

This paper studies the e ects of agent heterogeneity on optimal capital income tax rates. In a two period model with arbitrarily many heterogeneous agents, we explicitly derive the welfare e ects of taxation depending on the distribution of the agents' characteristics. In particular, we show that the sign of the optimal capital income tax rate depends not on the extent of inequality in goods en...

nowadays the phrase “social capital” has become one of the widely used general terms in social studies. the impact of social capital on economies and politics has expanded and has opened new venues for solving social and political malaise. one of the effects of social capital is its impact on personal welfare. in this article we have used a dynamic model containing two equations to study the im...

We study the response of domestic unemployment rates to shocks in total factor productivity for economies with high capital mobility and low labour mobility. We show that high capital mobility amplifies the impact on the domestic unemployment rate of domestic fluctuations in total factor productivity, shortens the lag of the response to shocks and raises the variability of unemployment. But ave...

If a government imposes a tax on capital income, it may, as a result, lower the private rate of return on capital below the growth rate of an economy, thereby giving rise to the possibility of running a permanent deficit. Since, however, the before-tax rate of return and not the after-tax rate of return is relevant for judging the dynamical efficiency of the economy, the possibility of a perman...