On Income Inequality and Green Preferences

We derive conditions on individual preferences and technology that give rise to a negative correlation between income inequality and environmental protection. We present a class of models (which captures a static model as well as an overlapping-generations model) in which individuals differ in earning abilities, and where a majority elected representative takes decisions over a pollution tax and a redistributive tax. We show that, if private consumption goods and the environment are non-inferior goods, then if the decisive individual has lower ability than the average, she will prefer a higher redistributive tax and a lower pollution tax.Environmental policy, redistribution, inequality, political economy

A statistical mechanical interpretation of instantaneous codes

In this paper we develop a statistical mechanical interpretation of the noiseless source coding scheme based on an absolutely optimal instantaneous code. The notions in statistical mechanics such as statistical mechanical entropy, temperature, and thermal equilibrium are translated into the context of noiseless source coding. Especially, it is discovered that the temperature 1 corresponds to the average codeword length of an instantaneous code in this statistical mechanical interpretation of noiseless source coding scheme. This correspondence is also verified by the investigation using box-counting dimension. Using the notion of temperature and statistical mechanical arguments, some information-theoretic relations can be derived in the manner which appeals to intuition.Comment: 5 pages, Proceedings of the 2007 IEEE International Symposium on Information Theory, pp.1906 - 1910, Nice, France, June 24 - 29, 200

Inequality, Environmental Protection and Growth

We analyze how, in representative democracies, income distribution influences the stringency of environmental policy and economic growth. Individuals (who differ in abilities) live for two periods, working when young and owning capital when old. Externalities are caused by a polluting factor. The revenue from pollution taxation, as well as capital-income taxation, is redistributed lump-sum to the old. The fiscal decision, at each point in time, is taken by a majority elected representative. In politico-economic equilibrium, more inequality (in terms of the skewness of the distribution) yields a lower pollution tax, a larger capital tax, and lower growth.Environmental policy, redistribution, inequality, political economy, growth.

Labour Market Institutions and the Employment Intensity of Output Growth. An International Comparison

This paper deals with the effects of labour market institutions on labour market performance. We analyse as an indicator for the labour intensity of output growth the employment threshold (the minimum growth rate of output necessary to keep employment constant). We show for a sample of 17 OECD countries for the period 1971 to 2002 that the strictness of employment protection raises the employment threshold in all econometric specifications. A higher wage bargaining coordination and a higher tax wedge reduce also the labour intensity of production, although the effects are not significant in all econometric specifications.employment protection, labour market institutions, labour demand, international comparison, employment threshold

Inequality, Environmental Protection and Growth

Why do Scandinavian countries perform better in terms of environmental protection than other European Union countries? In this paper, we explore the hypothesis that societies characterised by low income inequality (such as the nordic European countries) generate political-economic equilibria where environmental policy is more stringent. We model an overlapping-generations economy in which individuals differ in skills to address the question to what extent in modern democracies, income distribution influences the stringency of environmental policy and consequently the growth of a country. Individuals work when they are young and own capital when they are old. Pollution externalities are present due to the use of a polluting factor. The government uses the revenue from a capital-income tax and a pollution tax for a lump-sum transfer to the old generation. The fiscal decision at each point in time is taken by a majority elected representative. In politico-economic equilibrium, the lower the skill of the median individual is relative to the average, the smaller the pollution tax and the capital stock are, and the greater the capital income-tax and the relative use of the polluting factor. We perform both steady-state analysis and examine the transition path. Subsequently, we present an empirical analysis for two panels of seven and ten industrialised countries from the late seventies to late nineties. Our framework is able to explain the stylised facts regarding inequality, environmental protection, and growth.Environmental policy;majority voting;endogenous fiscal structure;income distribution;overlapping generations;growth

Labour Market Institutions and Employment Thresholds. An International Comparison

This paper deals with the effects to labour market institutions on labour market performance. We analyse the employment threshold (the minimum growth rate necessaryto keep employment constant) which is an indicator for the labour intensity of production. We show for 17 OECD countries for the period 1971 to 2002 that the strictness of employment protection, the extent of wage bargaining co-ordination and the tax wedge reduce the labour intensity of production and raise the employment threshold.Employment protection, labour market institutions, labour demand, internationaln comparison.

Failed Secular Revolutions: Religious Belief, Competition, and Extremism

All advanced economies have undergone secular revolutions in which religious belief and institutions have been subordinated to secular forms of authority. There are, however, numerous examples of failed secular transitions. To understand these failures, we present a religious club model with endogenous entry and cultural transmission of religious beliefs. A spike in the demand for religious belief, due for example to a negative economic shock, induces a new and more extreme organization to enter the religious market and exploit the dissatisfaction of highly religious types with the religious incumbent. The eect is larger where institutional secularization is more advanced, for example where the religious establishment has moderated itself or has been moderated by the political authority. The greater the moderation of the religious incumbent, the more extreme is the position chosen by the religious entrant, and the larger is the rise in religious participation. Hence, unanticipated shifts in religious demand can lead to the emergence of new and more extreme religious organizations, and reverse previous trends toward secularization. Our model sheds light on the causes and consequences of failed secular revolutions and religious revivals in Latin America and Egypt

Fuzzy qualitative simulation with multivariate constraints

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