Spencer Bastani, Daniel Waldenström, 09 November 2020

How should capital be taxed in advanced economies? This column presents a survey of the recent literature on optimal capital taxation and empirical studies on the distortionary effects of capital taxes. It provides specific analyses for taxes on wealth, property, inheritance, personal capital income, and corporate profits. Its overall conclusion is that capital taxation is part of an optimal tax system, but not all capital taxes strike a balance between optimality and administrative feasibility.

Benjamin Born, Gernot Müller, Johannes Pfeifer, Susanne Wellmann, 13 March 2020

Country spreads have traditionally been discussed in the context of emerging market economies, which tend to have high and volatile spreads. This column analyses spreads for both emerging and advanced economies before and after the Global Crisis. It argues that an ‘unpleasant convergence’ took place after 2008 and that the behaviour of country spreads in advanced economies is now similar to that in emerging economies. This is due to a both a decline in the volatility of the spreads for most emerging economies and an increase in volatility for advanced economies.

Olivier Blanchard, Paolo Mauro, Julien Acalin, 16 February 2016

One of the legacies of the Global Crisis is a high ratio of public debt to GDP. While current levels may be sustainable, another series of bad shocks could easily tip the balance and lead to unsustainable debt ratios. This column argues that against this background, growth-indexed bonds can help. By decreasing payments when growth is low, they can substantially reduce the upper tail of the distribution of the debt ratio and lessen the risk of a debt explosion. 


CEPR Policy Research