Supersedes previous editions
Supersedes previous editions
This paper revisits earlier studies on the determinants of tax amnesties. The novel findings are (i) amnesties are more likely to be declared during fiscal stress periods, and (ii) political factors significantly affect the introduction and timing of amnesties. In particular, the paper empirically disentangles opposite theoretical effects to show that governors perceive amnesties as another revenue source (rather than a tax increase alternative). Finally, supporting evidence shows that by breaking horizontal equity, amnesties might be perceived as unfair: a significant correlation exists between governors who lost their reelection bids and the introduction of a tax amnesty during their election years.
They could therefore blame the governor as being incompetent and not reelect
him/her. In the case where an amnesty is unsuccessful, then the governor's
reputation could also be tarnished by having introduced an unsuccessful
program. On the other hand, a positive and significant effect would arise if
governors think of tax amnesties and tax increases as substitutes. A tax amnesty
program is not a new tax but an administrative scheme to collect past taxes. With
tax increases ahead of ...
Tax amnesties remain as popular as ever as a tool for raising revenue and increasing tax compliance. International experience, however, shows that the costs of tax amnesty programs often exceed the programs’ benefits. This paper weighs the advantages and disadvantages of tax amnesties, drawing on results from the theoretical literature, econometric evidence, and selected country and U.S. state case studies. The authors conclude that “successful” tax amnesties are the exception rather than the norm. Improvements in tax administration are the essential ingredient in addressing the main problems that tax amnesties seek to address. Indeed, the most successful amnesty programs rely on improving the tax administration’s enforcement capacity. ?Given the potential drawbacks of tax amnesties, a few alternative measures are discussed.
In this section we analyze the recent trends in tax amnesties, and some evidence
is provided regarding their revenue and compliance effects. The first section is
devoted to a review of the econometric literature on the (mainly revenue) effect of
tax amnesties. The second section describes the U.S. states' experience with
amnesties (through a general overview and then two case studies: the tax
amnesty programs of Kentucky and Michigan, both in 2002). The experience of
the U.S. ...
There are, by now, several long term, time series data sets on important housing & macro variables, such as land prices, house prices, and the housing wealth-to-income ratio. However, an appropriate theory that can be employed to think about such data and associated research questions has been lacking. We present a new housing & macro model that is designed specifically to analyze the long term. As an illustrative application, we demonstrate that the calibrated model replicates, with remarkable accuracy, the historical evolution of housing wealth (relative to income) after World War II and suggests a further considerable increase in the future. The model also accounts for the close connection of house prices to land prices in the data. We also compare our framework to the canonical housing & macro model, typically employed to analyze business cycles, and highlight the main differences.
services by combining a developed real estate and residential buildings ("
structures"). Construction firms manufacture structures by employing materials
and labor. The numeraire sector produces a final good by combining physical
capital, labor, and land. Like in standard (one-sector) models, the numeraire
good can be used for (nonresidential) consumption or for physical capital
investments. It can also be transformed into materials that serve as input for
building structures.
Based on a survey that we designed and that covers a stratified random sample of 12,400 firms in 120 cities in China with firm-level accounting information for 2002-2004, this paper examines the presence of systematic distortions in capital allocation that result in uneven marginal returns to capital across firm ownership, regions, and sectors. It provides a systematic comparison of investment efficiency among wholly and partially state-owned, wholly and partially foreignowned, and domestic privately owned firms, conditioning on their sector, location, and size characteristics. It finds that even after a quarter-of-century of reforms, state-owned firms still have significantly lower returns to capital, on average, than domestic private or foreign-owned firms. Similarly, certain regions and sectors have consistently lower returns to capital than other regions and sectors. By our calculation, if China succeeds in allocating its capital more efficiently, it could reduce its investment intensity by 5 percent of GDP without sacrificing its economic growth (and hence deliver a greater improvement to its citizens' living standard).
We perform a set of simulations on the percentage increment in GDP due to an
optimal reallocation of capital as a function of some basic parameters. Three
parameters are key to the simulations. (a) The capital share in the production
function. Under the assumption that both the ARPKs in Table 2 and the MRPKs in
Table 5 are valid, we can infer the capital share by the ratio of MRPK/ARPK. As
the median MRPK and median ARPK for the whole sample are 0.61 and 0.88,
respectively, ...
Given the backdrop of pressing infrastructure needs, this paper argues that higher German public investment would not only stimulate domestic demand in the near term and reduce the current account surplus, but would also raise output over the longer-run as well as generate beneficial regional spillovers. While time-to-build delays can weaken the impact of the stimulus in the short-run, the expansionary effects of higher public investment are substantially strengthened with an accommodative monetary policy stance—as is typical during periods of economic slack. The current low-interest rate environment presents a window of opportunity to finance higher public investment at historically favorable rates.
Production This paper focuses on the role of government investment and
productive public capital. Indeed, firms use public infrastructure (which is the
government capital stock) along with private capital and labor for production. A
simplified version of the production function is shown below: As in Baxter and
King (1993), Glomm and Ravikumar (1997), and Leeper and others (2010), an
increasing returns to scale with respect to productive public capital is assumed. A
higher stock of ...
This book, by A. Premchand, seeks to bridge fiscal economics and government accounting. It examines historical developments, ingredients of existing systems, features of accounting standards, and other issues that governments must address to perform their tasks economically and efficiently. Readers gain insights into institutional linkages and the role of electronic technology. Arguing that government accounting systems are too important to be left to accountants alone, the book presents an interdisciplinary approach that goes beyond adapting commercial accounting formats to governments.
This book, by A. Premchand, seeks to bridge fiscal economics and government accounting.
This paper aims at developing a better understanding of Islamic banking (IB) and providing policy recommendations to enhance the supervision of Islamic banks (IBs). It points out and discusses similarities and differences of IBs with conventional banks (CBs) and reviews whether the IBs are more stable than CBs. Given the risks faced by IBs, the paper concludes that they need a legal, corporate and regulatory framework as much as CB does. The paper also argues that it is important to ensure operational independence of the supervisory agency, which has to be supported by adequate resources, a sound legal framework, a well designed governance structure, and robust accountability practices.
AAOIFI BCBS BCP CAMELS CAR CB FSI HQLA IFRS IFSB LCR NFSR PER PLS
PSIA RIA SSB URIA GLOSSARY Accounting and Auditing Organization for
Islamic Financial Institutions Basel Committee on Banking Supervision Basel
Core ...
This paper outlines the recent progress in developing Islamic financial instruments for the management of monetary policy and public borrowing requirements and provides details on new instruments currently being developed in the Islamic Republic of Iran and Sudan. The paper also touches on the institutional arrangements for interbank market operations and the design of effective central bank credit facilities that are needed under Islamic banking to support the development and operation of these new instruments.
This paper outlines the recent progress in developing Islamic financial instruments for the management of monetary policy and public borrowing requirements and provides details on new instruments currently being developed in the Islamic ...
The relative financial strength of Islamic banks is assessed empirically based on evidence covering individual Islamic and commercial banks in 18 banking systems with a substantial presence of Islamic banking. We find that (i) small Islamic banks tend to be financially stronger than small commercial banks; (ii) large commercial banks tend to be financially stronger than large Islamic banks; and (iii) small Islamic banks tend to be financially stronger than large Islamic banks, which may reflect challenges of credit risk management in large Islamic banks. We also find that the market share of Islamic banks does not have a significant impact on the financial strength of other banks.
Section II provides a short overview of the specifics of Islamic banking from a
prudential perspective, and discusses the associated risks (more details are
provided in Appendix I). Section III discusses the methodology, and introduces
the ...
