Fiscal Policies and Trade: On the existence of Nash equilibria

This paper studies the existence of a fiscal Nash equilibrium in a multi-country model of trade where the relative prices are the channels of transmission of scal policies between countries. We stipulate the necessary conditions on goods, consumptions and trade that allow for the existence of a Nash equilibrium in the fiscal game. In the particular case of homotethic utility functions, we show that conditions on the shape and the degree of the curvature of the relative prices functions are sufficient to guarantee the existence of the Nash equilibrium.Fiscal policy, Trade, Nash equilibrium.

Further Consideration of the Existence of Nash Equilibria in an Asymmetric Tax Competition Game

In this methodological paper, we prove that the key tax competition game introduced by Zodrow and Mieszkowski (1986) and Wildasin (1988), extended to asymmetric regions, possesses a Nash equilibrium under several assumptions commonly adopted in the literature : goods are supposed to be normal ; the public good is assumed to be a desired good ; the demand for capital is concave ; and the elasticity of the marginal product is bounded. The general framework we develop enrables us to obtain very tractable results. By applying our method to several examples with standard production functions, we show that it is easy to use.Nash equilibrium, tax competition.

The Timing of Elections in Federations : A Disciplining Device against Soft Budget Constraints ?

We introduce political economics into the soft budget constraint problem by asking if the timing of elections has the potential to harden budget constraints. Specifically, we ask under which circumstances the soft budget constraint problem is worse - with synchronized elections, i.e. simultaneous central and regional office terms, or with staggered elections, i.e. terms of office that do not coincide. We find that staggered elections clearly improve fiscal discipline at the local level as well as welfare.Soft budget constraints, fiscal federalism, elections.

Effects of abandonment on plant diversity in seminatural grasslands along soil and climate gradients

Questions: What are the effects of abandonment on plant diversity in semi-natural grasslands? Do the effects of abandonment on taxonomic and functional diversity vary along environmental gradients of climate and soil? Location: West and mid-Norway. Methods: Plant composition was surveyed in 110 subplots of 4 m2 in 14 sites across grazed and abandoned semi-natural grasslands. Climate data were extracted and soil composition analysed. To reduce the number of explanatory variables and deal with collinearity, we performed PCA. Data on the plant species vegetative height (H), leaf dry matter content (LDMC), specific leaf area (SLA), seed mass (SM) and number of seeds per plant (SNP) for 175 species were extracted from the LEDA database. Measures of plant diversity (species richness, CWM of functional traits and functional diversity (evenness and range)) were calculated for each subplot. To estimate the effects of abandonment on plant diversity and examine how these effects are moderated by gradients in soil and climate, we fitted mixed models to the data including site as a random effect. Results: Species richness in the subplots was lower in abandoned semi-natural grasslands, especially on more calcareous soils. CWM H, LDMC and SM were higher in abandoned semi-natural grasslands. CWM LDMC was only higher in the driest subplots. The ranges in H, SLA and SM, as well as evenness in LDMC were also higher in abandoned semi-natural grasslands, but the range in LDMC was lower. Conclusions: It is important to assess both taxonomic and functional diversity to understand ecosystem processes. The species pool in ecosystems influenced by a long history of intermediate grazing includes a high proportion of low stature, grazing-tolerant plant species. Abandonment of extensive land-use practices will cause a decline in taxonomic diversity (plant species richness) in such systems due to increased abundance of plants with high stature that outcompete the lower, grazing-tolerant plants. This process is predominant especially if moisture, soil fertility and pH are at intermediate levels. Changes in species communities due to abandonment will also influence ecosystem functioning, such as nutrient turnover and fodder production resilience. (Résumé d'auteur

When Trade Leads to Inefficient Public Good Provision: a Tax competition model

URL des Documents de travail : http://centredeconomiesorbonne.univ-paris1.fr/documents-de-travail-du-ces/Documents de travail du Centre d'Economie de la Sorbonne 2016.20 - ISSN : 1955-611XThis paper analyses the tax competition mechanisms in a context of commodity trade. We show that the trade market equilibrium may restore the efficiency of the public good provision when agents from different countries have symmetric preferences. Asymmetry in preferences implies over or underprovision in public goods depending on the degree of asymmetry between countries. In both cases, the price adjustment leaves the capital stock unchanged so that the stock of capital is not affected by the taxes. Finally, we show that the centralized choice does not systematically restore the efficiency of the public good provision.Cet article analyse les mécanismes de concurrence fiscale dans un contexte d'échanges de biens entre deux pays. Nous montrons que l'équilibre de la balance commerciale peut restaurer l'efficacité de la fourniture de biens publics lorsque les agents des différents pays ont des préférences symétriques. Une asymétrie dans les préférences des agents entraine une sous-provision ou une sur-provision des biens publics selon le degré d'asymétrie. Dans les deux cas, l'ajustement des prix égalise les rendements du capital de sorte que le stock de capital reste inchangé suite à une modification des taxes. Enfin, nous montrons que l'équilibre centralisé ne restaure pas systématiquement l'efficacité de la fourniture de biens publics

The Timing of Elections in Federations : A Disciplining Device against Soft Budget Constraints ?

URL des Documents de travail : http://ces.univ-paris1.fr/cesdp/CESFramDP2010.htmDocuments de travail du Centre d'Economie de la Sorbonne 2010.36 - ISSN : 1955-611XWe introduce political economics into the soft budget constraint problem by asking if the timing of elections has the potential to harden budget constraints. Specifically, we ask under which circumstances the soft budget constraint problem is worse - with synchronized elections, i.e. simultaneous central and regional office terms, or with staggered elections, i.e. terms of office that do not coincide. We find that staggered elections clearly improve fiscal discipline at the local level as well as welfare.Dans cet article, nous introduisons des éléments d'économie politique dans un problème de contrainte budgétaire molle en étudiant si l'organisation simultanée ou décalée des élections nationales et locales a un impact sur la discipline budgétaire des gouvernements locaux. Nous montrons que des élections décalées permettent très clairement de durcir la contrainte budgétaire molle et améliorent le bien-être des agents de la fédération. Ce résultat s'explique par le fait que le gouvernement central bénéficie d'une position de leadership en élections décalées qui permet de contenir le comportement opportuniste des gouvernements locaux

Which compensation for whom ?

URL des Documents de travail : http://ces.univ-paris1.fr/cesdp/cesdp2012.htmlDocuments de travail du Centre d'Economie de la Sorbonne 2012.80 - ISSN : 1955-611XThis paper examines a situation where a decision-maker determines the appropriate compensation that should be implemented for a given ecological damage. The compensation can be either or both in monetary and environmental units to meet three goals : i) no aggregate welfare loss, ii) minimization of the cost associated with the compensation, iii) minimal environmental compensation requirement. The findings suggest that - in some cases - providing both monetary and environmental compensation can be the best option. We also emphasize the impact of implementing a minimal environmental compensation constraint especially in terms of equity and cost efficiency.Cet article détermine la compensation optimale qu'un décideur public doit imposer de mettre en place à un pollueur responsable d'un dommage environnemental. La compensation peut être soit monétaire, soit environnementale, soit une combinaison des deux. Elle doit permettre d'atteindre trois objectifs : i) pas de perte de bien-être agrégée, ii) une minimisation du coût associé à la compensation, iii) une compensation écologique minimale. Les résultats montrent que - dans certains cas - une compensation à la fois monétaire et environnementale peut être la meilleure option. Nous insistons également sur les impacts de la mise en oeuvre d'une contrainte de compensation écologique minimale notamment en termes d'équité et d'efficacité

The three worlds of welfare capitalism revisited

URL des Documents de travail : http://ces.univ-paris1.fr/cesdp/cesdp2012.htmlDocuments de travail du Centre d'Economie de la Sorbonne 2012.18 - ISSN : 1955-611XWe introduce a new way to model the Bismarckian social insuance system, stressing its corporatist dimension. Comparing the Beveridgean, Bismarckian and Liberal systems according to the majority voting rule, we show that for a given distribution of risks inside society, the Liberal system wins if the inequality of income is low, and the Beveridgean system wins if the inequality of income is high. Using a utilitarian criterion, the Beveridgean system always dominates and the Bismarckian system is preferred to the Liberal one.Dans cet article, nous introduisons la dimension corporatiste dans la modélisation du système de protection sociale à la Bismarck. En comparant les systèmes beveridgien, bismarckien et libéral selon la règle de vote à la majorité, nous montrons que pour une distribution donnée des risques à l'intérieur de la société, le système libéral, est préféré si l'inégalité des revenus est faible, et le système beveridgien est préféré si l'inégalité de revenu est élevée. Sous un critère utilitariste, le système beveridgien domine toujours et le système bismarckien est préférable au système libéral