This paper analyzes the effects of tariffs in an intertemporal optimizing framework emphasizing the role of capital accumulation. Unanticipated permanent, anticipated temporary, and anticipated permanent increases in the tariff rate are considered. In all cases, the introduction of a tariff is...

An integrated stochastic equilibrium growth model is constructed and directed to various questions pertaining to monetary and tax policy. Two main issues addressed include (1) the tradeoff between the rate of capital accumulation and inflation in a stochastic environment; and (2) economic...