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246 records from EconBiz based on author Name
1. Taxation of Capital : Capital Levies and Commitment
abstractChamley and Judd argued that optimal taxation dictates zero long-run tax rates on capital income, but Straub and Werning found that tax rates may be positive even in the steady state. These models feature a "period-zero problem" in the underlying Ramsey formulation, which omits past commitments but includes future ones. The period-zero policymaker then imposes capital levies on initial assets--directly or indirectly through positive tax rates on future asset income and non-constant tax rates on consumption. Chari, Nicolini, and Teles add commitment by the period-zero policymaker to households' initial wealth in utility units. In this case, a nonzero capital levy may apply in period zero, future tax rates on asset income equal zero, and tax rates on consumption are constant. Time-consistency fails if future policymakers are unconstrained but holds if commitments to initial wealth in utility units are strict enough each period to motivate each policymaker to choose zero direct capital levies. In that case, a timeless perspective applies where period zero is not special, tax rates on asset income are always zero, and tax rates on consumption are constant. Introduction of uncertainty generates state-contingent levies on assets and random-walk-like variations in consumption tax rates
Barro, Robert J.; Chari, Varadarajan V.;2024
Type: Arbeitspapier; Working Paper; Graue Literatur; Non-commercial literature;
Availability: Link Link
2. On the efficiency of competitive equilibria with pandemics
Chari, Varadarajan V.; Kirpalani, Rishabh; Pérez, Luis;2023
Type: Graue Literatur; Non-commercial literature;
Availability:
Link Link Link 3. On the Efficiency of Competitive Equilibria with Pandemics
abstractThe epidemiological literature suggests that virus transmission occurs only when individuals are in relatively close contact. We show that if society can control the extent to which economic agents are exposed to the virus and agents can commit to contracts, virus externalities are local, and competitive equilibria are efficient. The Second Welfare Theorem also holds. These results still apply when infection status is imperfectly observed and when agents are privately informed about their infection status. If society cannot control virus exposure, then virus externalities are global and competitive equilibria are inefficient, but the policy implications are very different from those in the literature. Economic activity in this version of our model can be inefficiently low, in contrast to the conventional wisdom that viruses create global externalities and result in inefficiently high economic activity. If agents cannot commit, competitive equilibria are inefficient because of a novel pecuniary externality
Chari, Varadarajan V.; Kirpalani, Rishabh; Pérez, Luis;2023
Availability: Link
4. The Hammer and the Scalpel : On the Economics of Indiscriminate versus Targeted Isolation Policies during Pandemics
abstractWe develop a simple dynamic economic model of epidemic transmission designed to be consistent with widely used SIR biological models of the transmission of epidemics, while incorporating economic benefits and costs as well. Our main finding is that targeted testing and isolation policies deliver large welfare gains relative to optimal policies when these tools are not used. Specifically, we find that when testing and isolation are not used, optimal policy delivers a welfare gain equivalent to a 0.6% permanent increase in consumption relative to no intervention. The welfare gain arises because under the optimal policy, the planner engineers a sharp recession that reduces aggregate output by about 40% for about 3 months. This sharp contraction in economic activity reduces the rate of transmission and reduces cumulative deaths by about 0.1%. When testing policies are used, optimal policy delivers a welfare gain equivalent to a 3% permanent increase in consumption. The associated recession is milder in that aggregate output declines by about 15% and cumulative deaths are reduced by .3%. Much of this welfare gain comes from isolating infected individuals. When individuals who are suspected to be infected are isolated without any testing, optimal policy delivers a welfare gain equivalent to a 2% increase in permanent consumption
Chari, Varadarajan V.; Kirpalani, Rishabh; Phelan, Christopher;2020
Availability: Link Link
Citations: 4 (based on OpenCitations)
5. The hammer and the scalpel : on the economics of indiscriminate versus targeted isolation policies during pandemics
Chari, Varadarajan V.; Kirpalani, Rishabh; Phelan, Christopher;2020
Type: Graue Literatur; Non-commercial literature; Arbeitspapier; Working Paper;
Availability: Link
6. Optimal cooperative taxation in the global economy
Chari, Varadarajan V.; Nicolini, Juan Pablo; Teles, Pedro;2022
Type: Graue Literatur; Non-commercial literature;
Availability:
Link Citations: 1 (based on OpenCitations)
7. Appendix for: Optimal cooperative taxation in the global economy
Chari, Varadarajan V.; Nicolini, Juan Pablo; Teles, Pedro;2022
Type: Graue Literatur; Non-commercial literature;
Availability:
Link Link 8. The Hammer and the Scalpel : On the Economics of Indiscriminate Versus Targeted Isolation Policies During Pandemics
abstractWe develop a simple dynamic economic model of epidemic transmission designed to be consistent with widely used SIR biological models of the transmission of epidemics, while incorporating economic benefits and costs as well. Our main finding is that targeted testing and isolation policies deliver large welfare gains relative to optimal policies when these tools are not used. Specifically, we find that when testing and isolation are not used, optimal policy delivers a welfare gain equivalent to a 0.6% permanent increase in consumption relative to no intervention. The welfare gain arises because under the optimal policy, the planner engineers a sharp recession that reduces aggregate output by about 40% for about 3 months. This sharp contraction in economic activity reduces the rate of transmission and reduces cumulative deaths by about 0.1%. When testing policies are used, optimal policy delivers a welfare gain equivalent to a 3% permanent increase in consumption. The associated recession is milder in that aggregate output declines by about 15% and cumulative deaths are reduced by .3%. Much of this welfare gain comes from isolating infected individuals. When individuals who are suspected to be infected are isolated without any testing, optimal policy delivers a welfare gain equivalent to a 2% increase in permanent consumption
Chari, Varadarajan V.; Kirpalani, Rishabh; Phelan, Christopher;2022
Availability: Link
9. The Poverty of Nations : A Quantitative Exploration
abstractWe document regularities in the distribution of relative incomes and patterns of investment in countries and over time. We develop a quantitative version of the neoclassical growth model with a broad measure of capital in which investment decisions are affected by distortions. These distortions follow a stochastic process which is common to all countries. Our model generates a panel of outcomes which we compare to the data. In both the model and the data, there is greater mobility in relative incomes in the middle of the income distribution than at the extremes. The 10 fastest growing countries and the 10 slowest growing countries in the model have growth rates and investment-output ratios similar to those in the data. In both the model and the data, the `miracle' countries have nonmonotonic investment-output ratios over time. The main quantitative discrepancy between the model and the data is that there is more persistence in growth rates of relative incomes in the model than in the data
Chari, Varadarajan V.; Kehoe, Patrick J.; McGrattan, Ellen R.;2022
Availability: Link
10. Business Cycle Accounting
abstractWe propose a simple method to help researchers develop quantitative models of economic fluctuations. The method rests on the insight that many models are equivalent to a prototype growth model with time-varying wedges which resemble productivity, labor and investment taxes, and government consumption. Wedges corresponding to these variables -- effciency, labor, investment, and government consumption wedges -- are measured and then fed back into the model in order to assess the fraction of various fluctuations they account for. Applying this method to U.S. data for the Great Depression and the 1982 recession reveals that the effciency and labor wedges together account for essentially all of the fluctuations; the investment wedge plays a decidedly tertiary role, and the government consumption wedge, none. Analyses of the entire postwar period and alternative model specifications support these results. Models with frictions manifested primarily as investment wedges are thus not promising for the study of business cycles
Chari, Varadarajan V.; Kehoe, Patrick J.; McGrattan, Ellen R.;2022
Availability: Link
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