This paper presents a unified theory that provides an intertemporal reconciliation between conflicting viewpoints about the effect of inequality on economic growth. It argues that the replacement of physical capital accumulation by human capital accumulation as a prime engine of economic growth...

This Paper hypothesizes that the demise of the 19th century's European class structure reflects a deliberate transformation of society orchestrated by the Capitalists. Contrary to conventional wisdom, it argues that the demise of this class structure has been in part an outcome of a cooperative...

The academic literature on equality of opportunity has burgeoned. More recently, the concepts and measures have begun to be used by policy institutions, including in specific sectors like health and education. Indeed, it is argued that one advantage of focusing on equality of opportunity is that...

One often heard counter to the concern on rising income and wealth inequality is that it is wrong to focus on inequality of outcomes in a “snapshot.” Intergenerational mobility and “equality of opportunity”, so the argument goes, is what matters for normative evaluation. In response to...

We investigate how the assumption that individuals are characterized by some recent forms of behavioural preferences changes the analysis of an otherwise classical welfare problem, namely the optimal allocation of a scarce resource among a finite number of claimants. We consider two preference...

We analyse different forms of international debt mutualisation in a simple framework with a political distortion and (partial) default under adverse economic circumstances. One form is a debt repayment guarantee, which can be "unlimited" or "limited", i.e. only be invoked when the guarantee...

This paper compares constraints on the public debt with constraints on the primary deficit. The analysis takes into account how an optimizing government reacts to the different constraints when deciding on a spending and borrowing plan. We find that the economy behaves similarly under both...

In a competitive two-country overlapping generations model with perfect capital mobility, a plan that is individually Pareto optimal (that is Pareto optimal with respect to individual preferences) can be sustained without coordination of national fiscal policies where the fiscal arsenal is...

The literature on new goods and social welfare generally assumes that manufacturers develop innovations. But innovation by users has been found to also be an important part of innovative activity in the economy. In this Paper we explore the impact of users as a source of innovation on product...

Destination countries are progressively shifting towards selective immigration policies. These can eectively increase migrants' average education even if one allows for endogenous schooling decisions and education policies at origin. Still, more selective immigration policies reduce social...