This paper studies dynamic non-linear taxation in a two-period model without government commitment and a continuum of agents with privately known skill parameters, which are constant overtime. The government is utilitarian but cannot commit at t=1 to the tax scheme that she will propose at t=2....

In this paper, we generalize the notion of Pareto-efficiency to make it applicable to environments with endogenous populations. Two different efficiency concepts are proposed, P-efficiency and A-efficiency. The two concepts differ in how they treat people that are not born. We show how these...

We augment a standard global coordination game along the lines of Morris and Shin (1998) by an asset market where prices are determined in a noisy Rational Expectations Equilibrium. We study the implications of information aggregation through prices for equilibrium selection arguments in global...

To study the political economy of immigration, we develop a common agency model where a trade union and a lobby of entrepreneurs offer contributions to the government to influence its decision on how many immigrants can enter the domestic economy. In the political equilibrium, anticipating that...

Many countries run substantial inflations. They do this despite the overwhelming theoretical arguments (and empirical evidence?) showing that price stability (or even mild deflation) is "better." This paper provides a simple model in which a government sometimes uses the inflation tax because it...

This paper uses a seminonparametric model and Consumer Expenditure Survey data to estimate life cycle profiles of consumption, controlling for demographics, cohort and time effects. In addition to documenting profiles for total and nondurable consumption, we devote special attention to the age...

Tobin's Q exceeds one, even without any adjustment costs, for a firm that earns rents as a result of monopoly power or of decreasing returns to scale in production. Even when there are no adjustment costs and marginal Q is always equal to one, Tobin's Q is informative about the firm's growth...

Economies respond differently to aggregate shocks that reduce output. While some countries rapidly recover their pre-crisis trend, others stagnate. Recent studies provide empirical support for a connection between aggregate growth and plant dynamics through their effect on productivity: the...

We construct a bilateral search model of the housing market in which agents differ in their flow rewards while searching. Buyers and sellers enter the market with high flow rewards, but move at a Poisson rate to a state with low flow rewards if they do not transact in the meantime. We...

The paper sets out a monetary business cycle model extended to include the production of credit that serves as an alternative to money in transactions and is subject to productivity shocks. The model provides some improvement on certain puzzles, in particular by capturing the procyclic movements...