Governmental Transfers Can Reduce a Moral Hazard Problem

An altruistic agent who may aid a person with a low income may cause that person to exert little effort to increase his income. Such behavior generates a Dilemma, in which welfare is lower than when no one is altruistic. We show how governmental transfers, which do not allow for reallocation from a person who saves much to one who saves little, reduces the effect, and can lead to an outcome which is Pareto-superior to the outcome under a Nash equilibrium with no government taxation and transfers.Social security; Moral hazard; Savings; Altruism

"Efficiency of Disaggregate Public Capital Provision in Japan"

We investigate the efficiency of disaggregated public capital provision for the Japanese economy. We estimate the optimality conditions based on simultaneous Euler equations by using GMM. Our results suggest that public capital productivities have been relatively high and divergent among several public capital goods. The allocation of public works is not optimal yet in Japan.

Migration in Search of Good Government

Residents both enjoy the policies adopted in their cities, and choose those policies. If some people can better evaluate policies than can others, then the most perceptive people will be the most willing to move to the city with better policies, thereby making that city more likely to adopt good policies in the future. Such migration can cause agglomeration, with some cities prospering and others failing.

Innovation and Imitation Across Jurisdictions

We consider cities which can increase the income of landowners or of capital owners by improving the quality of public services. The improvement can come from innovation or from imitation. We find that when cities aim to benefit landowners, too many cities innovate; but too few cities innovate when the city aims to benefit capital owners. Redistribution across cities can ameliorate these inefficiencies.Tax competition; Innovation; Interjurisdictional differences

The Bowman-Bradley theorem for multiple zeta-star values

The Bowman-Bradley theorem asserts that the multiple zeta values at the sequences obtained by inserting a fixed number of twos between 3,1,...,3,1 add up to a rational multiple of a power of pi. We establish its counterpart for multiple zeta-star values by showing an identity in a non-commutative polynomial algebra introduced by Hoffman.Comment: 17 page

"Japanese Fiscal Reform: Fiscal Reconstruction and Fiscal Policy"

This paper evaluates the recent movement of Japanese fiscal reform. We first summarize fiscal policy in 1990s. Then, we investigate several relevant topics of fiscal policy such as the macroeconomic impact of government debt and the ustainability problem. We then consider dynamic properties of fiscal reconstruction process by analyzing the dynamic game among various interest groups. This paper points out that the long-run structural reform is more important than the short-run Keynesian policy in Japan.