This paper presents a political economy model that explains the low rate of emission taxes in the U.S., as well as the fact that neither Democrats nor Republicans propose to increase them. The voters differ according to their wage and capital incomes which are assumed to have a bivariate...

What accounts for the existence of positive energy taxes in the US, given that such taxes are regressive and that the income distribution is skewed to the right? The traditional majority-voting equilibrium approach suggests a subsidy; thus we also look at two alternatives. These are the...

This paper studies the issue of political support for environmental taxes. The environmental tax is determined by majority voting, given a refund rule that specifies the allocation of tax proceeds. The refund rule is chosen by a welfare-maximizing constitutional planner. We show that: (i) The...

This paper studies majority voting outcomes for a specific class of two-dimensional policies. One policy instrument influences efficiency and the other redistribution. Absent the political process, the two dimensions can be addressed separately. With a two dimensional vote, the two aspects will...

This paper models a two-period overlapping generations economy in the steady state where the realization of the quantity/quality number of children depends on an initial investment in children and on a random shock. It shows that the implementation of the first-best allocation, in which the...