Publications

In March 2010, when the Greek debt crisis was heating up, then-ECB president Jean Claude Trichet declared to the EU parliament that the “monetary Union in Europe is far more than a monetary arrangement. It is a union of shared destiny”. Less than two months later the ECB reversed its refusal to monetize debt and openly started buying government bonds in violation of its own charta. Germany also gave up its reservations about bailing out other countries. A first aid deal for Greece was signed and, because that didn’t help for long, a Euro rescue package to the tune of € 750 billion was put in place.

As is publicly known, Mariano Rajoy, leader of the Spanish Partido Popular, recently became president of the Spanish government. Mr. Rajoy is poised to introduce new measures needed by the Spanish economy in order to, in first instance, stop the bleeding (in general terms, but in particular regarding unemployment rates), and subsequently, to initiate a new positive trend for the country, as a relevant part integrated in the European Union economy.? ? Among the urgent measures, those related to taxation are essential to achieve a balanced economy.

WP 2012-01. Executive Summary This paper analyses intergovernmental transfers in France and Italy to assess how soft budget spending behaviors may result from slacks in institutional constraints or from phenomena…

“What would you (try to) do to save your country from economic collapse?” This is indeed a difficult and tricky question, and one that is normally answered along the lines of interventionist economic thinking. The fatal conceit that Hayek wrote about is embedded in this same question: it assumes that the leader of the State will be able to take the appropriate actions to lead the economy (a very complex social order) to whatever goals.

The emergence of a global government cartel without any restrictions to tax and spend their citizens’ wealth would lead to a world that is less free and less prosperous. The financial and economic crisis that unfolded from 2008 has led many governments to intensify their efforts against what has been dubbed “tax evasion”, i.e., the protection of wealth or capital outside a citizen’s or a firm’s home country.

France is famous for its wine, cheese and…unions. It is well established now that any reform considered by any government, left or right, has to be approved by unions (or, at least, not strongly opposed) in order to have a chance to be passed. Strange situation in a country where less than 8% of all employees have a union membership card–the lowest rate in the EU. Despite the poor legitimacy that such a low membership rate implies, unions are getting important grants and allowances from the state as well as from businesses.

A widespread understanding of the 2007-2008 crisis places the origins of the crisis in a capture of global economy by the finance industry. The “occupy Wall Street” group would surely agree, as well as most of those who get their economics from the general media. And President Sarkozy in his recent Toulon’s speech did confirm the thesis. If this understanding is correct then it is natural to call for further regulation of the finance industry. But not everyone agrees, and some economists favor another understanding.

WP 2011-01. Executive Summary Numerous, and often conflicting, principles guide the design of a tax structure. One of those principles is that taxation should promote growth, or at least should…

Do fiscal decisions of incumbent mayors affect their probability of being re-elected? Do they consider the fiscal decisions of the neighboring mayors when they face an election? And do these…

The sovereign debt crisis forces our governments to stretch their imagination in order to find additional budget revenues. In Europe, as well as in the US, many voices call for additional contributions from the rich (not such a big stretch of imagination, in fact, if it was for the already high contribution asked from them). Interestingly, some eminent wealthy people like Warren Buffet in the US or Liliane Bettencourt (L’Oréal) in France welcome the idea, denouncing a system that deprives them from the possibility of making an equitable tax contribution (read more about this here).