O. J. Blanchard's (1985) formulation of the overlapping-generations model and the social welfare function advocated by G. Calvo and M. Obstfeld (1988) are used to analyze interest taxation and tariffs in a small open economy. When the revenue lost from the elimination of these taxes is replaced by raising the tax on labor, as in recent Canadian experience, a 'low' social discount rate is required for the model to support lower interest-income taxes, while a 'high' discount rate is needed to support the elimination of tariffs. The authors illustrate the empirical importance of this simultaneous need for both a 'high' and a 'low' discount rate.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Contact details of provider: Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4 Email: Web page: http://economics.ca/cje/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Prof. Werner Antweiler).
Related research
Keywords:
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)