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We offer a new explanation for why taxes have become less progressive in many countries in parallel with an increase in income inequality. When performance-based compensation differentials are needed to incentivize effort, redistribution through progressive income taxes becomes less precisely...
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In this paper, we explore the role of trade in differentiated final goods as well offshoring of tasks for inequality both within and between countries. We emphasize the distinction between managerial and production labor. Production labor is assumed to be a variable input composed of tradable...
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Trust games are employed to investigate the effect of heterogeneity in income and race on cooperation in South Africa. The amount of socio-economic information available to the subjects about their counterparts is varied. No significant behavioural differences are observed, when no such...
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