We examine the effect of population size on government size for a panel of 130 countries for the period between 1970 and 2014. We show that previous analyses of the nexus between population size and government size are incorrectly specified and fail to consider the influence of cross-sectional...

One of the key institutional elements for reducing inequality is the tax and transfer system. However, economists and policymakers usually view high taxes as detrimental to economic growth. We isolate one important mechanism by which higher taxes reduce inequality and raise per capita gross...

"Over-the-counter derivative contracts bind institutions together in a network of opaque, credit risks the size and characteristics of which can change rapidly and can be said to be not understood with a high degree of precision, including by market participants themselves." (Garry J. Schinasi,...

We analyse a duopoly setting with complementary products, in which a firm has a bias about its absolute advantage. We show that the bias can internalize parts of the negative externality that the complementarity of goods creates implying a higher producer's surplus. Moreover, we analyse...