Using a finance-constrained model, as in Barinci and Cheron (2001), this paper examines the role of procyclical and countercyclical tax rates on labor and capital income in aggregate fluctuations driven by the beliefs of agents. The analysis shows that the cyclicality of labor income tax rate has the monotonically negative impact on the possibility of indeterminacy, while the non-monotonic rela...

From its inception, development economics has revered the industrialization process. Economists from Smith to Rostow to Gershenkron to Lewis have emphasized the importance of industrial factories as crucibles in which the division of labor is refined, a labor force is developed, and technical knowledge is generated and shared. And though the poorest countries with weak industrial sectors are al...

Rapid population aging is becoming a common feature in Asian countries where changes in the age distribution as well as the size and growth of their populations are having significant economic impacts. A positive economic effect is realized from the demographic transition from high to low rates of mortality and fertility which produces a large share of the working-age group in the total populat...

This study examines the spillover effects of foreign direct investment (FDI) on green technology progress rate (as measured by the green total factor productivity). The analysis utilizes two measures of FDI, labor-based FDI and capital-based FDI, and separately investigates four sets of industry classifications-high/low discharge regulation and high/low emission standard regulation. The results...

Does Human Capital Protect Workers against Exogenous Shocks? South Africa in the 2008-2009 Crisis The financial and economic crisis of 2008 and 2009 has taken its toll on the South African economy. The economy contracted for the first time since 1998, and entered recession during the fourth quarter of 2008. The GDP contraction was soon transmitted to the labor market. Between the second quarter...

We develop a model of human capital formation with endogenous labor supply and heterogeneous agents to explore the optimal level of education subsidies along with the optimal schedule of the labor income tax. If the government can observe inputs into the production of human capital, subsidies on education ensure efficiency in human capital accumulation and labor taxes are more progressive than ...

Taxing internationally mobile factors of production has been dismissed as an inefficient means of raising tax revenue. This paper addresses the question of whether it is efficient to tax capital at source when labor markets and the taxation of lumpsum income suffer from imperfections. Four reasons for taxing capital are identified: (i) institutional constraints rendering any taxation of profit ...

In this paper we use data from the New Immigrant Survey to investigate the impact of immigrant women's own labor supply prior to migrating and female labor supply in their source country on their labor supply and wages in the United States to provide evidence on the roles of culture and social capital. We find, as expected, that women who migrate from countries with relatively high levels of fe...

The increase in wage inequality since 1980 in the United States has been more pronounced in larger cities, even after accounting for di¤erences in the composition of the workforce across locations. Using Census of Population and Census of Manufacturers data aggregated to the local labor market level, this paper examines the importance of changes in the factor bias of agglomeration economies, ca...