The paper considers the history of theories of income distribution, from the time of Adam Smith until the 1970s. It is divided into two main parts. Part I considers the positive theory of income distribution, beginning with the classical economists’ analysis of the functional distribution of...

In his Wealth of Nations (1776) Adam Smith created an agenda for the study of the economy that is reflected in the structure of modern economics. This paper describes Smith’s contributions to four central areas of economic theory: The theory of price formation, the relationship between market...

This paper considers economists’ treatment of problems related to the environment prior to the establishment of environmental economics as a separate field in the 1960s. In discussing the literature from the late 18th century onwards, it looks on the one hand for awareness in the work of the...

The paper reviews the theory of environmental taxation under first best and second best conditions. It argues that negative environmental externalities lead to reductions of the provision of public goods, while investment in abatement increases the supply of public goods. Together with optimal...

The marginal cost of public funds is usually seen as a number greater than one, reflecting the efficiency cost of distortionary taxes. But economic intuition suggests that since green taxes are efficiency-enhancing the MCF with such taxes will be less than one. The paper demonstrates that this...

The paper gives an overview of some main themes in the theory of tax evasion, starting from Allingham and Sandmo (1972). It reviews the comparative statics of the original model of individual behavior where the tax evasion decision is analogous to portfolio choice, and its extensions to...