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In this paper, we investigate whether unemployment benefits should decrease with the unemployment spell in a model where both job search intensity and wages are endogenous. Wages are set by collective agreements bargained by insiders. It is shown that a more declining time sequence of unemployment benefits leads to wage increases when the tax rate is given. Such an effect may imply an increase in unemployment and counteracts the response of job search intensity that can be found in standard job search models with a given wage distribution. Calibration exercises suggest that it costs twice more in terms of welfare loss for the long-term unemployed workers to reduce the unemployment rate of one percent when wages are endogenous than in the standard job search model.

This paper presents a unified model of the default and prepayment behavior of homeowners in a proportional hazard framework. The model uses the option-based approach to analyze default and prepayment and considers these two interdependent hazards as competing risks. The results indicate the sensitivity of default to the initial loan-to-value ratio of the loan and the course of housing equity. The latter is a measure of the extent to which the default option is in the money. The results also indicate the importance of trigger events, namely unemployment and divorce, in affecting prepayment and default behavior. The empirical results are used to analyze the costs of a current policy proposal -- stimulating homeownership by offering low downpayment loans. We simulate default probabilities and costs on zero-downpayment loans and compare them to conventional loans with conventional underwriting standards. The results indicate that if zero-downpayment loans were priced as if they were mortgages with ten percent downpayments, then the additional program costs would be two to four percent of funds made available -- when housing prices increase steadily. If housing prices remained constant, the costs of the program would be much larger indeed. Our estimates suggest that additional program costs could be between $74,000 and $87,000 per million dollars of lending. If the expected losses from such a program were not priced at all, the losses from default alone could exceed ten percent of the funds made available for loans.

This paper analyses the distribution and allocation of budgetary subsidies and tax arrears in Central and Eastern Europe. Budgetary subsidies are relatively small in aggregate, highly sector specific, and the manufacturing sector receives few of them. Tax arrears, by contrast, are a significant problem, and the paper argues they can be considered a form of government subsidy. Data for the various Visegrád countries suggest that the total stock of tax arrears is on the order of 5- 10% of GDP, the annual flow of tax arrears is around 2% of GDP, and the annual flow of tax arrears to the manufacturing sector is around 1% of GDP. Survey data from Hungary and Poland show that tax arrears are concentrated in a small number of low profitability firms; the main correlate of tax arrears is low profitability; and the flow of new tax arrears is the main financing that enables these very unprofitable firms to continue to operate.

In addition to transferring about 16 percent of GDP from exporters to importers, Uzbekistanís quasi-fiscal multiple exchange rate regime generates identifiable welfare losses of 2-8 percent of GDP on import markets and up to 15 percent on export markets. These excess burdens have increased substantially with the growing difference among exchange rates. The welfare analysis allows some conclusions regarding the optimal reform strategy: (i) welfare losses will decline overproportionally as exchange rates unify, (ii) exchange rate unification should be supplemented by changing the explicit fiscal system; (iii) at a minimum, Uzbekistan would benefit from moving to an explicit fiscal regime. Copyright 2001, International Monetary Fund

In this Reply, we concede that our assumption that per capita expenditures will grow by the maximum permitted under Proposition 4 is arbitrary. How "unrealistic" this assumption is (would be) cannot be known. Nevertheless, we viewed the assumption under debate as necessary to the undertaking of our exploratory analysis of the effects of Proposition 4 because it provided the analysis with a parameter, and a reasonably plausible one at that. The second issue raised concerns our use of the services price index (SPI) to measure inflation. It is argued by ours critics that the consumer price index (CPI) would have been a better choice. We argue the issue is trivial since the percent change in the SPI is nearly identical to that of the CPI over the study period.

With the enhanced business activity in Ukraine and increasing number of large business entities the search for effective mechanisms to improve the tax control over major taxpayers has been intensified. According to the Ministry of Revenue and Duties of Ukraine, for the period of 2010-2013 their number has grown from 586 to 1,486 units or correspondingly 29.0 %. In 2014 the Register of major taxpayers has accounted for 2,131 businesses. Provided a more favorable business climate in the country is developed, the number of major taxpayers will only be growing. Thus, the relevant is the research into foreign experience in tax control over major taxpayers. The article provides the analysis of major tax payers tax control procedure in Ukraine and in the developed countries. Based on the results of research the author has offered recommendations as to the organizational and economic mechanism for improving the tax control over major taxpayers in Ukraine allowing for progressive foreign trends in this field.

This study extends a recent study on migration according to race, i.e., white migrants on the one hand and black migrants on the other hand. This study specifies that white migration should be treated as a function of white unemployment rate and white income levels, whereas black migration should be a function of black unemployment rates and black income levels. The reasoning is simple: the levels of black and white unemployment rates and incomes are very different. The end policy-related result of the empirical analysis finds that white migrants prefer to move to states with lower welfare levels per recipient (arguably because such states do less income redistribution) whereas black migrants prefer to move to higher welfare states (where the welfare serves as a form of higher income and/or a form of higher unemployment insurance).