Commodity taxation and regulatory competition

in International Tax and Public Finance (2019), 26(4),

The purpose of this paper is twofold. We first investigate whether product market regulations affect commodity taxation in open-to-trade economies, and second, we study the strategic interaction in ... [more ▼]

The purpose of this paper is twofold. We first investigate whether product market regulations affect commodity taxation in open-to-trade economies, and second, we study the strategic interaction in regulatory measures between trading partner countries. We present a two-country general equilibrium model in which destination-based commodity taxes finance public goods, and product market regulation affects both the number of firms in the market and product diversity. Based on data for 21 OECD countries over the 1990–2008 period, we provide empirical evidence suggesting that product market regulations are strategic complement policies and that domestic regulations have a negative impact on domestic commodity taxation. [less ▲]

Green Urban Areas

E-print/Working paper (2019)

This paper studies the size and location of urban green areas across city spaces. Urban green areas offer amenities that affect residential choices, land consumption and land rent. This paper discusses ... [more ▼]

This paper studies the size and location of urban green areas across city spaces. Urban green areas offer amenities that affect residential choices, land consumption and land rent. This paper discusses the socially optimal sizes and locations of urban green areas within a city and their decentralized allocation through land markets. The main result is that the share of land dedicated to urban green areas is a concave function of the distance to the city center. This result is confirmed by the empirical study of urban structures in the 305 largest EU cities. The importance of urban green areas is finally assessed by a counterfactual analysis, where 50% of urban green areas are removed in each city. [less ▲]

Trade and Vertical Differentiation

E-print/Working paper (2019)

This paper discusses a trade model with many countries, many goods produced in multiple quality versions, and non-homothetic preferences. It embeds in the same model a series of results that have been ... [more ▼]

This paper discusses a trade model with many countries, many goods produced in multiple quality versions, and non-homothetic preferences. It embeds in the same model a series of results that have been empirically confirmed: high-income countries specialize in the production of high-quality goods and trade more of those. Richer countries purchase more high-quality varieties. They import more high-quality products from the most productive exporters. The paper then studies the impact of productivity and population changes on the quality composition of exports. It finally explains why countries import higher quality goods from more distant countries. [less ▲]

Urban spatial structure, employment and social ties

in Journal of Urban Economics (2018), 104(C), 77-93

Consider a model where workers from the majority and the minority group choose both their residential location (geographical space) and the intensity of their social interactions (social space). We ... [more ▼]

Consider a model where workers from the majority and the minority group choose both their residential location (geographical space) and the intensity of their social interactions (social space). We demonstrate under which condition one group resides close to the job center while the other lives far away from it. Even though the two groups have the same characteristics and there is no discrimination in the housing or labor market, we show that the majority group can have a lower unemployment rate whenever it resides close to or far away from the workplace. This is because this group generates a larger and better-quality social network. [less ▲]

Income Inequality, Productivity, and International Trade

E-print/Working paper (2018)

This paper discusses the effect of income inequality on selection and aggregate productivity in a general equilibrium model with non-homothetic preferences. It shows the existence of a negative ... [more ▼]

This paper discusses the effect of income inequality on selection and aggregate productivity in a general equilibrium model with non-homothetic preferences. It shows the existence of a negative relationship between the number and quantity of products consumed by an income group and the earnings of other income groups. It also highlights the negative effect of a mean-preserving spread of income on aggregate productivity through the softening of firms’ selection. This effect is however mitigated in the presence of international trade. In a quantitative analysis, it is shown that an excessively large mean-preserving spread of income may harm the rich as it raises firms’ markups on their purchases. This is contrary to the general belief that income inequality benefits the rich. [less ▲]

Urban Interactions

E-print/Working paper (2017)

This paper studies social-tie formation when individuals care about the geographical location of other individuals. In our model, the intensity of social interactions can be chosen at the same time as ... [more ▼]

This paper studies social-tie formation when individuals care about the geographical location of other individuals. In our model, the intensity of social interactions can be chosen at the same time as friends. We characterize the equilibrium in terms of both social interactions and social capital (the value of social interactions offered by each agent) for a general distribution of individuals in the urban geographical space. We show that greater geographical dispersion decreases the incentives to socially interact. We also show that the equilibrium frequency of interactions is lower than the effcient one. Using a unique geo-coded dataset of friendship networks among adolescents in the United States, we estimate the model and validate that agents interact less than the social first best optimum. Our policy analysis suggests that, given the same cost, subsidizing social interactions yields a higher total welfare than subsidizing transportation costs. [less ▲]

Equilibrium and first-best city with endogenous exposure to local air pollution from traffic

in Regional Science and Urban Economics (2017), 62

Exposure to urban traffic-induced air pollution is a major health concern of cities. This paper analyzes the urban structure when localized pollution exposure arises from commuting traffic and ... [more ▼]

Exposure to urban traffic-induced air pollution is a major health concern of cities. This paper analyzes the urban structure when localized pollution exposure arises from commuting traffic and investigates the feedback effect of endogenous pollution on residential choices. The presence of stronger traffic-induced air pollution exposure reduces the geographical extent and the population of cities. Land rents fall with distance from the city center while population densities may be non-monotonic. Cleaner vehicle technologies reduce pollution exposure everywhere, increase population and density everywhere and do not affect the spatial extent of the city. The paper compares the urban equilibrium with the first-best. The first-best structure is a less expanded city with higher densities at the center and lower densities at the fringe. [less ▲]

Income Effects and Vertical Differentiation in International Trade

E-print/Working paper (2016)

We analyse a trade model with non-homothetic preferences and different quality ver- sions of each product. Income effects drive the quality composition of consumption, pro- duction and trade flows. We ... [more ▼]

We analyse a trade model with non-homothetic preferences and different quality ver- sions of each product. Income effects drive the quality composition of consumption, pro- duction and trade flows. We show that a rise in local population fosters local asymmetric specialization in high-quality production and exports while it harms low income groups. By contrast, an increase in local productivity may generate specialization in high quality production, which in turn may trigger an immiserizing growth process. Weaker compa- rative advantages induce firm to move and make a local productivity improvement more likely to increase production of higher quality goods everywhere. [less ▲]

Airport Congestion and Inefficiency in Slot Allocation

E-print/Working paper (2015)

This paper analyzes optimal slot allocation in the presence of airport congestion. We model peak and offpeak slots as vertically differentiated products, and congestion limits the number of peak slots ... [more ▼]

This paper analyzes optimal slot allocation in the presence of airport congestion. We model peak and offpeak slots as vertically differentiated products, and congestion limits the number of peak slots that the airport can allocate. Inefficiency emerges when the airport does not exploit all its slots. We show that for a private airport, inefficiency may arise if the airport is not too congested and the per-passenger fee is small enough, while with a public airport it does not emerge. Furthermore the airport, irrespective of its ownership, tends to give different slots to flights with same destination if the underlying market is a duopoly, and a single slot if the underlying market is served by a monopoly. [less ▲]

Jean Tirole: de la microéconomie à l'économie comportementale

Article for general public (2015)