An endogenous growth model is examined where individuals optimize consumption and tax evasion over time given the tax structure and tax compliance policy of the government. Applying methods of stochastic optimal control, the individual’s problem is solved and the rate of economic growth is derived. It is shown that for a given tax policy tax evasion spurs growth because it leads to higher savin...

In this paper, I explore the optimal extent to which the central bank should disseminate information among private agents. Individual firms are assumed to have diverse private information, and the central bank provides public information either implicitly, by setting its policy instrument, or explicitly, by making announcements about its short-run targets. The optimal degree of economic transpa...

We examine trends since 1980 in material extraction in China, India, Indonesia, and Japan—which together contain over 40% of the world’s population—to assess the environmental consequences of modernization. Economic and population growth has driven rapid expansion of material extraction in China, India, and Indonesia since 1980. China and India exhibit patterns consistent with the Jevons parado...

In the developing economies, optimal forest regimes should incorporate the socio-economic characteristics of the user groups. And, since socio-economic factors will change with time, optimal forest regimes will also follow a dynamic path. The two most important socio-economic factors are the heterogeneity of the user group with respect to forest management and the direct dependence of the user ...

In this paper we develop an economic growth model that includes anthropogenic climate change. We explicitly include a research sector that creates new technologies and simultaneously expands productivities of existing technologies. The environment is affected by R&D activities both negatively, through increase of output from productivity growth, as well as positively, as new technologies are le...

Most available results on optimal decisions under partial information are derived “separation”. But this principle does not always hold. We derive a non-standard first order condition of optimality from principles when signal extraction and policy must be jointly determined. This allows us to solve model fiscal where separation apply. Tax smoothing prevails in normal times, but taxes respond st...

Energy extraction from ocean waves and conversion to electrical energy is a promising form of renewable energy, yet achieving economic viability of wave energy converters (WECs) has proven challenging. In this article, the design of a heaving cylinder WEC will be explored. The optimal plant (i.e. draft and radius) design space with respect to the design’s optimal control (i.e. power take-off tr...