We examine how U.S. monetary and fiscal policy shocks affect emerging markets’ aggregate economy. We find that emerging markets’ reaction to U.S. policy shocks differ widely from those of industrialized countries. Expansionary policies tend to depreciate the currencies of emerging...

We revisit the question of optimal capital taxation in an international context with endogenous international investment (portfolio) decisions and assets that are imperfect substitutes. According to the conventional view, increasing mobility of capital across borders should lead to a...