The purpose of this paper is to clarify the answers given in a number of seminal public finance articles to the following questions :

1. a) What is a proportional tax structure and when is it optimal ?

2. b) What is the difference between the optimality conditions for optimal public sector pricing and for optimal taxation?

These issues were along with several others considered in three articles that appeared concomitantly: Lerner (1970), Baumol and Bradford (1970) and Dixit (1970), The articles were subsequently commented upon by Ng (1972), Bradford and Baumol (1972) and Sandmo (1974).

1. INTRODUCTION

Si nous n’étions pas ici dans une institution vouée à la recherche scientifique, la situation économique de la Belgique se prêterait à une question d’aspect relativement superstitieux. Nous sommes effectivement en droit de nous demander si les plaies de l’Egypte ne se sont pas abattues sur notre pays. Montant record de la dette publique, un taux de chômage parmi les plus élevés au sein des pays membres de l’OCDE, baisse de l’investissement et du pouvoir d’achat, multiples faillites d’entreprises: tout se conjugue pour nous montrer que notre pays traverse une des périodes les plus sombres de son histoire économique. Plusieurs grands prêtres économistes ont certes émis des avis plus éminents les uns que les autres à ce sujet, mais il nous faut bien reconnaître que la comparaison biblique s’arrête là et que la Belgique n’a pas encore trouvé son Moïse.

This article examines the real convergence hypothesis in eleven emerging countries by means of fractionally integrated techniques. For this purpose, we examine the order of integration of the real GDP per capita series in Argentina, Brazil, Chile, Colombia, Mexico, Peru, Venezuela, India, Indonesia, Taiwan and South Korea as well as their differences with respect to the US and Japan. We find evidence of smaller degrees of integration in the differenced series only for some of the Latin American countries with respect to the US, and for all the Asian countries with respect to both the US and Japan. However, we only find evidence of real convergence for the cases of Argentina and Chile with respect to the US, and Taiwan with respect to Japan, suggesting thus the possibility of different convergence clubs among both Latin American and Asian countries.

Clearly there remain number of problems in the field of energy today. Of particular relevance is the role of substitutes and/or backstop technologies (see Nordhaus (1973)) in affecting the extraction decisions of monopolistic producers of (scarce) exhaustible resources.

Research and development is currently underway in most industrialized countries with the objective of producing alternatives to conventional energy inputs. Two principle motivating factors appear to be stimulating R & D in nations which import a significant share of their resource requirements for energy production. The first involves the inherent scarcity of these inputs which, unlike other capital assets, are nonrenewable. The second factor (which is augmented by the first) concerns the strategic or « essential » (see Dasgupta & Heal (1979)) nature of exhaustible resources in production. Such inputs often lie concentrated in the hands of a few potentially unstable regimes which for either political or strategic reasons makes continued dependance on these resources undesirable.

In standard microeconomic theory, short-run and long-run marginal costs are equal for production equipment with adjusted capacity. When the production of joint products from interdependent equipment is modeled with a linear program, this equality is no longer verified. The short-run marginal cost then takes on a left-hand value and a right-hand value which generally differ from the long-run marginal cost. In this article, we demonstrate and interpret the relationship existing between long-run marginal cost and shortrun marginal costs for a given finished product. That relationship is simply expressed as a function of marginal capacity adjustments (determined in the long run) and marginal values of capacities (determined in the short run).

Dans une analyse dynamique, il est logique de supposer que la firme cherche à agir sur son environnement afin de l’aménager dans son propre intérêt. En situation de concurrence imparfaite, l’entreprise dispose de variables de décision qui lui permettent cette action. Cette observation conduit à intégrer la théorie du contrôle optimal à la théorie économique de la firme, en identifiant les variables de décision aux variables de commande.

Notre objectif est de présenter un modèle de comportement dynamique de l’entreprise avec différenciation du produit, suffisamment général pour englober comme cas particulier différentes situations de concurrence.

L’action de la firme sur son environnement peut prendre différentes formes. Nous nous limiterons ici à l’influence sur la demande.

Cet article fournit une synthèse des principaux résultats contenus dans ma thèse de doctorat consacrée à l'efficience informationnelle du marché boursier. Il s'intéresse non seulement à la vérification empirique de l'hypothèse d'efficience informationnelle du marché, mais aborde également un nombre limité de questions se rapportant aux implications théoriques de cette hypothèse au niveau des modèles de comportement du prix des actions et de gestion professionnelle de portefeuilles.

Un accident survenant à la livre sterling est, pour l'économie mondiale, un événement majeur : d'abord, parce qu'il est l'aboutissement de tensions graves qui s'exacerbent et se dénouent dans une crise; ensuite, parce qu'il crée des rapports nouveaux dans le système international des prix et dans les relations financières. Ceux-ci requièrent des processus d'ajustement.

Certes, la crise du sterling se préparait depuis de longues années et seules la date et les modalités restaient problématiques. Elle était, d'autre part, de plus en plus imbriquée dans la crise de liquidité internationale dont les éléments ont apparu clairement dès 1958.

Un groupe d'agents décide de mettre à sa disposition un site collectif polluant. Pour ce faire, ils font appel à une entreprise chargée de la localisation et de la construction de l'installation. Celle-ci leur propose une procédure de localisation/tarification soumise à l'approbation de tous les agents. Dans un tel contexte, l'entreprise est forcée à internaliser les dommages subis par les agents dans sa fonction de coût: ce phénomène rappelle l'achat de droit à polluer. En information incomplète, les mécanismes incitatifs optimaux indiquent l'existence d'inefficacités dues à l'attribution d'une rente informationnelle à chaque agent: la localisation échoue alors qu'elle aurait profité à tout le monde. Dans deux applications (externalités diffuses et ex-ternalités locales) du modèle général, l'enchère optimale est complètement caractérisée.

Until recently standard trade theory had ignored the fact that resources are devoted not only to production of goods and services but also to rent, revenue and tariff seeking activities. Competitive rent and revenue seeking and their impact on welfare and resource allocation have been thoroughly examined by A. Krueger [1974] and J. Bhagwati and T. Srinivasan [1980]. The studies mentioned above are based on the presumption that rent seeking and lobbying activities effect the availability of physical inputs employed in the production of goods. In this paper we argue that lobbying also affects the efficiency of firms through its impact on the allocation of managerial effort which is internal to the firm. This stems from the fact that firms can raise their profits by lobbying for tariffs which in turn raise the domestic price. Since managerial effort is an input in both production and lobbying activities, and since the likelihood of having a tariff levied depends on the lobbying effort, we expect some managerial effort to be directed to lobbying at the expense of production and thus adversely affecting the production efficiency of firms.

G. Duménil et D. Lévy soulignent le rôle du taux de profit dans la dynamique du capitalisme. Ils affirment réhabiliter l’économie classique et, en même temps, proposer une nouvelle interprétation de l’histoire économique américaine. Notre commentaire porte uniquement sur l’aspect théorique. La portée générale de leur théorie est mise en cause. En adoptant leurs hypothèses restrictives, la théorie néoclassique permet d’établir des résultats comparables en matière de stabilité. Quel que soit l’intérêt de leur modèle, les auteurs ne démontrent pas sa supériorité sur la dynamique standard, au moins en ce qui concerne les résultats généraux. Un second point de discussion concerne leur traitement de la monnaie et du crédit.

Current unemployment is at unacceptably high levels for both the segment of the population concerned and policy-makers in most industrialised countries. The causes of the rise in world-wide unemployment are usually attributed to the severe supply shocks in the 1970s (the sharp increase in oil and other raw material prices), the associated redistribution of income from countries with high propensities to spend to countries with low propensities to spend, inadequate policy responses and rigidities in industrial economies responsible for slow adjustment to a different environment(‘)• Rigidities seem to be more severe for the countries of the EEC than for Japan and the US and unemployment consequently has risen more sharply in the EEC. The main rigidity can be seen in the high growth of real wage costs. Instead of attenuating the supply shocks through moderate wage increases the effects of these shocks have been accentuated in the EEC by the wage cost explosion of the 1970s. An approximate empirical measure for these effects is provided by the sharp increase of the real wage cost gap in EEC countries which, however, is an underestimate since firms have responded by reducing employment to improve productivity.

The purpose of this paper is to study the effects of a devaluation on the economic variables of major concern in a non-oil producing developing country. The question of whether a devaluation can be expected to produce effects similar to those experienced in industrial countries is of considerable practical interest. For example, the International Monetary Fund has frequently been critized for recommending devaluation in developing countries faced with non-transitory current account deficits. Opponents of devaluation point to the rudimentary economic structure of these countries and take the empirical fact that terms of trade are usually exogenous to these countries (with few exceptions) as an indication of the impotence of devaluation to redress the current account. The only clearcut effect of devaluation would then be a rise in domestic prices. In paper this I argue that, even when the terms of trade remain unaffected, devaluation can have strong effects on the domestic relative price structure and thus on the sectoral allocation of resources, on development of the economy, and on the current account.

La présente étude a comme but principal de rechercher de quelle façon la consommation des trois principales graisses alimentaires, le beurre, la margarine et le saindoux, a évolué pendant la période de 1920–1937, et de déterminer le rapport éventuel entre la consommation et les prix de ces graisses.

Dans plusieurs pays, et principalement aux États-Unis d’Amérique, des études approfondies ont été publiées sur les éléments déterminants de la production et des prix de nombreuses denrées agricoles. Nous rappelons ici surtout les études du Département of Agriculture, de l’Université de Cornell, du Wheat Institutes.

Le beurre cependant, n’est guère traité, malgré son grand intérêt.

Son importance économique saute aux yeux en parcourant le tableau I, lequel, bien que ne relatant pas exactement la production mondiale annuelle du beurre, nous donne toutefois une estimation suffisante de la production annuelle du beurre dans les régions productrices les plus importantes.

Granger-causality tests and innovation analyses based on Vector Autoregression models seem to deny any role for monetary factors in generating and shaping business cycle fluctuations. The present paper shows that such empirical support for Real Business Cycle theories is flawed. In particular, it is demonstrated that an extended version of the Lucas paradigm can explain the existing evidence rather accurately, when changes in policy regimes are explicitly modelled.

In this paper, we study the role of habit formation in accounting for the joint behavior of the real interest rate and consumption growth following a monetary policy shock. A VAR estimation on US data shows that following a contractionary monetary policy shock, the real interest rate exhibits a persistent increase while consumption growth drops persistently. As the standard permanent income model is known to be unable to replicate this co–movement for intertemporal substitution motives, we introduce habit persistence in consumption behavior. We test the implied Euler equation using a method of moments on conditional moments (IRF) obtained from the VAR model. Our estimates of the habit persistence parameter are similar to previous results in the literature. Further, we find empirical support in favor of habit formation as a relevant assumption to represent the joint behavior of the real interest rate and consumption growth following a monetary policy shock. Finally, we show that habit formation allows weakening the intertemporal substitution mechanism.

In recent years a large number of macroeconomic rationing models with smooth CES transaction functions have been estimated. The widely used CES transaction functions with three arguments are often claimed to be derivable (as approximate relationships) from an assumption of lognormally distributed demands and supplies. One objective of this paper is to point out that the reasoning offered in the literature for this claim is not very clear or rigorous. Another, and more constructive, objective is to analyse and discuss in detail the derivation and properties of the CES transaction functions. Basic assumptions underlying the CES transaction functions are illuminated on the basis of a rather general description of the aggregation problem in models with both goods and labour markets, and general properties of transaction functions based on “multiplicative distributional assumptions” are analysed. Several new results concerning the exact derivation of the CES transaction functions on the basis of the Weibull distribution are shown. The quality of the CES transaction functions as approximate relationships given lognormally distributed demands and supplies is discussed. Finally it is shown that the CES transaction functions have reasonable properties.