Estudos Econômicos (São Paulo)
Print version ISSN 0101-4161
GONCALVES, Carlos Eduardo Soares. Taxação ótima e movimentos migratórios em uma união monetária. Estud. Econ. [online]. 2004, vol.34, n.3, pp. 441-452. ISSN 0101-4161. http://dx.doi.org/10.1590/S0101-41612004000300002.
This article presents a simple model in which a part of a heterogeneous labor force may find it optimal to flee a state (or a country) negatively affected by an adverse economic shock. Crucially, a non-benevolent government, choosing the tax rate to maximize public revenue, has to take workers’ ”participation constraint” into consideration. It is found that a negative shock lasting for a prolonged period might induce higher or lower tax rates, depending on how severe migration costs are.
Keywords : migration; taxation; shocks.