Intergenerational and international welfare leakages of a tariff in a small open economy

A dynamic overlapping-generations model of a small open economy with imperfect competition in the goods market is constructed. A tariff increase reduces output and employment and leads to an appreciation of the real exchange rate both in the impact period and in the new steady state. The tariff shock has significant intergenerational distribution effects. Old existing generations gain less than both younger existing generations and future generations. Bond policy neutralizes the intergenerational inequities and allows the computation of first-best and second- best optimal tariff rates. The first-best tariff exploits national market power, but the second-best tariff contains a correction to account for the existence of a potentially suboptimal product subsidy.

Intergenerational and international welfare leakages of a tariff in a small open economy

A dynamic overlapping-generations model of a small open economy with imperfect competition in the goods market is constructed. A tariff increase reduces output and employment and leads to an appreciation of the real exchange rate both in the impact period and in the new steady state. The tariff shock has significant intergenerational distribution effects. Old existing generations gain less than both younger existing generations and future generations. Bond policy neutralizes the intergenerational inequities and allows the computation of first-best and second-best optimal tariff rates. The first-best tariff exploits national market power, but the second-best tariff contains a correction to account for the existence of a potentially suboptimal product subsidy.

Documentation of CORTAX

CORTAX is applied in Bettendorf et al. (2006), a simulation study on the economic and welfare implications of reforms in corporate income taxation. This technical documentation of the model consists of the derivation and listing of the equations of the model and a justification of the calibration.

Study on the impacts of fiscal devaluation. Final report

The main research question of the project is summarized as: What are the macroeconomic and distributional consequences of fiscal devaluation for a selection of countries and the EU as a whole? The selected countries are France, Italy, Spain and Austria. The project aims to perform four tasks: 1. Provide a review of the impacts of fiscal devaluations in the light of economic literature and former studies. 2. Use suitable models to analyse macroeconomic impacts of fiscal devaluation in the selected countries and do a comparative analysis of the results obtained in different countries. 3. Analyse distributional impact of fiscal devaluations with the help of models in the selected countries and link these results, if possible, to the macro-level analysis. 4. Analyse the suitability of the policy for the EU as a whole with the help of model simulations and in the light of the country-specific results

An empirical study of the distribution of crops in agricultural land in Belgium: 1900-1939

Die Verteilung einer Anzahl von Ernten in ausgewählten Regionen Belgiens wird als Resultat eines Entscheidungprozesses gesehen, der sich (unter anderen Faktoren) hauptsächlich am finanziellen Ertrag orientiert. Dieses Allokationsproblem wird analog der Portofolio-Selection-Theorie angegangen; die Entscheidungen beim Anlageverhalten in Wertpapieren (Aktien oder Investmentzertifikate oder festverzinsliche Wertpapiere usw.) ist von der Erwartung der voraussichtlichen Erträge sowie der Wahrscheinlichkeit ihres Eintreffens abhängig. Auch der Landwirt hat zu entscheiden, wie er sein "Vermögen" beim Anbau (Weizen oder Zuckerrüben oder Kartoffeln oder Flachs usw.) verteilt. Die Daten für den untersuchten Zeitraum passen gut auf die Annahmen des Portofolio-Modells. (pmb)The observed distribution of a number of crops in a certain area can be thought of as the result of a decision process influenced, among other factors, by the expected financial yields. This allocation problem is very similar to the one encountered in portfolio theory, that is, the distribution of certain wealth into different assets given a fixed interest rate structure (for example, Parkin, Gray and Barrett (1970), Bettedorf and Verjans (1988)). This led us to the idea of estimation of a modified portfolio model with data collected from Belgian agriculture. The results of this model allow interesting interpretations about the sensitivity of the different cultivated areas to change in the total available area and in financial yields. In the next section the specification of the allocation model will be theoretically derived. After the description of the data used, the results will be discussed in section 4. The last section is devoted to conclusion remarks

Do daily retail gasoline prices adjust asymmetrically?

This paper analyzes adjustments in the Dutch retail gasoline prices. We estimate an error correction model on changes in the daily retail price for gasoline (taxes excluded) for the period 1996-2004 taking care of volatility clustering by estimating an EGARCH model. It turns out the volatility process is asymmetrical: an unexpected increase in the producer price has a larger effect on the variance of the producer price than an unexpected decrease. We do not find evidence for amount asymmetry, either for the long run or for the short run. However, there is a faster reaction to upward changes in spot prices than to downward changes in spot prices. This implies timing or pattern asymmetry. This asymmetry starts three days after the change in the spot price and lasts for four days.

Who benefits from tax competition in the European Union?

Statutory tax rates have declined in the European Union in the recent decades. An applied general equilibrium model on corporate taxation sheds light on the economic and welfare implications of tax rate reforms. Domestic distortions proof highly relevant as even unilateral reductions of the corporate income tax rate might reduce welfare if the labour tax rate has to be increased. Profit shifting induces countries to underbid each others tax rates, but this effect is sizable only if two countries are closely linked. The harmful external effects of CIT rate reductions are limited, which reduces the need for European coordination of CIT rates.

Price formation of fish *1 An application of an inverse demand system

Inverse demand systems explain price variations as functions of quantity variations. They have properties analogous to those of regular demand systems. There are very few examples of their empirical application. In part this is due to lack of data for which price is the decision variable and the quantity given. The case of fish landed at Belgian sea ports appears to suit an inverse demand system well. A Rotterdam variant of such a system in estimated. Allais interaction intensities have been derived and show a reasonable pattern

Implications for Net Positions of the Agricultural Reform Agenda 2000

The budgetary consequences of the reform proposals in Agenda 2000 have stimulated the debate on the financial costs and benefits of EU-membership. This article analyses the implications of the proposed agricultural reform for the net contributions by simulating three scenarios. The inclusion of implicit trade subsidies is vital in the discussion on net positions. Agenda 2000 is projected to affect substantially the net positions of member states

How Competitive is the Dutch Coffee market?

World coffee bean prices have shown large fluctuations during the past years. Consumer prices for roasted coffee, in contrast, have varied considerably less. This article investigates whether the weak relationship between coffee bean and consumer prices can be explained by a lack of competition on the Dutch coffee market