Tax smoothing with immigration in an overlapping generations economy

Immigration policy in an overlapping generations economy is politically determined in response to government spending shocks, where the government finances its spending with proportional income taxes and is subject to a balanced budget. The young cohort is always the majority and dictates policy. Th...

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Bibliographic Details
Published inApplied economics letters Vol. 26; no. 6; pp. 460 - 464
Main Author Lopez-Velasco, Armando R.
Format Journal Article
LanguageEnglish
Published London Routledge 30.03.2019
Taylor & Francis LLC
Subjects
Budgets
Economic analysis
Economic models
Economic theory
Economics
Government spending
Immigrants
Immigration
Immigration policy
Income taxes
Markov perfect
Noncitizens
overlapping generations
political economy
tax smoothing
Taxation
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ISSN1350-4851
1466-4291
DOI10.1080/13504851.2018.1486975

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Summary:Immigration policy in an overlapping generations economy is politically determined in response to government spending shocks, where the government finances its spending with proportional income taxes and is subject to a balanced budget. The young cohort is always the majority and dictates policy. The equilibrium Markovian strategy allows immigrants when the spending shock is above some threshold and this implies a particular form of tax smoothing.
Bibliography:ObjectType-Article-1
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ISSN:1350-4851
1466-4291
DOI:10.1080/13504851.2018.1486975