Resolving the National Banking System note-issue puzzle

Under the National Banking System, 1863-1914, national banks that deposited sufficient collateral could issue notes provided they paid a tax on notes in circulation: 1 percent per year before 1900 and 1/2 percent thereafter. Because note issue was far below the allowed maximum, an arbitrage argument predicts that short-term nominal interest rates should have been bounded above by the tax rate. They were not. That is the note-issue puzzle. Our resolution takes the form of a model in which notes play a role, but in which the profitability of note issue is not tied to anything that resembles a market rate of interest.Bank notes ; National banks (United States)

Environmental taxes and policies for developing countries

Increasing urbanization and industrialization can exacerbate pollution problems in developing countries. Tax revenues in developing countries are too low to support adequate infrastructure for treating and disposing of wastes, but the problem is also attributable to the classic problem of externalities in productiion and consumption."Externalities"means that the costs of environmental degradation are not considered by the private decisionmakers undertaking the activities that cause the problems. Two types of policies are commonly considered to correct this market failure and improve the allocation of resources: command-and-control policies (such as emmission and abatement standards) and market-based incentive policies (such as emissions charges, taxes on production and consumption, and marketable pollution quotas), which raise the price of such activities for the perpetrators. Market based incentives theoretically reduce pollution at least cost and increase government revenues, but may require costly monitoring to be effective, and are usually implemented in an environment of imperfect information about the costs of abatement. Sometimes command and control policies make more economic sense in this environment. Efficiency gains from curbing pollution in developing countries may be large. Some polluting activities are subsidized, so curtailing them brings both fiscal and environmental benefits. Taxing polluting inputs and outputs is a particularly attractive policy in developing countries which often lack experience in administering and enforcing other types of environmental regulation. Corrective taxes make use of existing administrative structures and increase tax revenues, which can be spent on public goods to improve environmental quality (including treatment facilities for water and sewage, waste disposal, and sanitation) or can be used to reduce other taxes (which are often highly distortionary in countries with a narrow tax base). Which goods and inputs to single out for corrective taxation depends on the main sources of pollution, which varies from country to country. Air pollution from vehicles is growing in many countries where increased fuel taxes, perhaps coupled with improved regulations for vehicle maintenance, may be desirable. Higher taxes on high sulphur coal would curb both industiral and household emissions of sulphur dioxide. Charges can be implemented for fixed site easy to monitor industrial emissions. Subsidies to industries that cause pollution should be phased out and those industries should be subjected to higher than average tax rates.Water and Industry,Economic Theory&Research,Urban Services to the Poor,Urban Services to the Poor,Environmental Economics&Policies

Demography and Growth: A Unified Treatment of Overlapping Generations

We construct a unified overlapping-generations (OLG) framework of equilibrium growth that includes the Blanchard �perpetual youth� model, the Samuelson model, and the infinitely-lived representative agent growth model as limit specifications of a �realistic�, two-parameter survivorship function. We analyze how demographic conditions affect the equilibrium growth and savings rates in an economy by computing equilibrium rates under different specifications of the survivorship function. Differences in population growth rates, life-expectancies, retirement durations, and the degree of concavity of the survivorship function are found to have significant impacts on equilibrium growth rates. The observed effects are consistent with some cross-country correlations between demographic conditions and growth rates. We also identify a potential �Malthusian growth trap� in economies where life expectancy is short, fertility rates are high, and households work most of their lives�conditions often found in less developed economies.

Dynamic vs Oblivious Routing in Network Design

Consider the robust network design problem of finding a minimum cost network with enough capacity to route all traffic demand matrices in a given polytope. We investigate the impact of different routing models in this robust setting: in particular, we compare \emph{oblivious} routing, where the routing between each terminal pair must be fixed in advance, to \emph{dynamic} routing, where routings may depend arbitrarily on the current demand. Our main result is a construction that shows that the optimal cost of such a network based on oblivious routing (fractional or integral) may be a factor of \BigOmega(\log{n}) more than the cost required when using dynamic routing. This is true even in the important special case of the asymmetric hose model. This answers a question in \cite{chekurisurvey07}, and is tight up to constant factors. Our proof technique builds on a connection between expander graphs and robust design for single-sink traffic patterns \cite{ChekuriHardness07}

Shadow : Form, Illusion and Reality

This paper presents my views on the subject of shadow and its interpretative use as it may pertain to drawing. The factors upon which shadow is dependent are discussed as well as shadow as form and image. Also discussed is the development of shadow as it became an important concept and reality to me and how it pertains to my drawings. It has been recommended to further develop the use of shadow in my work as it relates to space and the illusion of space