Browsing by Author "Menescal, Lucas"
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- Breaking down inequality : can taxes be the great equalizer?Publication . Menescal, LucasGiven the contrasting evidence on the redistributive role of taxation, this study seeks to isolate the redistribution process performed through the tax and transfers system and address the effects of several taxes on the difference between pre- and post-tax and transfers Gini coefficients, commonly referred as the Reynolds-Smolensky Index (RSI), in a panel of 107 advanced and developing economies for the period between 1990 to 2020. Contrary to previous evidence, obtained results showed little evidence that direct taxation had significant redistributive effects, whereas indirect taxation only presented negative impacts on developed economies. Still, robust redistributive effects of social security contributions were observed for both groups, while property taxes seem to be associated with higher redistribution in the long run. Finally, the importance of investment and employment levels is underlined and policy recommendations for higher income redistribution are proposed.
- Determinants of trade partner concentration : an analysis for European countriesPublication . Afonso, António; Alves, José; Menescal, Lucas; Monteiro, SofiaAfter computing the Gini and Herfindahl-Hirschman indexes for exports and imports partner concentration for a set of 31 European countries between 1995 and 2023, we analyse the role of macroeconomic, institutional and uncertainty effects on the partner concentration (diversification) of exports and imports. From our analysis, we disentangle different effects, namely that while global GDP leads to an increase in concentration in both exports and imports, internal rates of return increase exports diversification, reducing it for imports. Additionally, European uncertainty reduces the concentration of the product countries’ origin/destination for imports and exports, respectively. Our results provide a comprehensive set of results that enable public authorities and firms to minimize their risks when trading with the exterior
- Optimal threshold taxation : an empirical investigation for developing economiesPublication . Menescal, Lucas; Alves, JoséIn this empirical study we assess both linear and nonlinear relationship between total taxation and several tax items with real per capita GDP growth rates for 43 developing countries between 1990 and 2019. We use panel data techniques to evaluate the effects of taxation on economic growth for both short and long run perspectives, and to find optimal tax threshold values. We obtain evidence of nonlinear relationships between all tax items, except for corporate income taxation, as well as an optimal value for total tax burden around 23,5% of GDP for the whole sample. When the sample is subdivided by countries’ income levels, we find threshold values for all tax items and an optimal tax burden around 23,6% of GDP for high income countries and 21,3% of GDP for low income. Our results provide support regarding the existence of nonlinearities and about policies focused on raising certain tax revenues, as a percentage of GDP, without hampering economic growth.
- Tax structure and public sector efficiency : new evidence for developing countriesPublication . Menescal, Lucas; Alves, JoséThis study examines the effects of the tax structure composition for public sector efficiency in a sample of 41 developing countries for the period between 1997-2019. We start by calculating Public Sector Performance (PSP) composite indicators and use them as outputs to compute data envelopment analysis (DEA) efficiency scores under different orientation setups. After using a general-to-specific approach to identify the most determinant variables, we analyze the relevance of different taxes for public efficiency in a panel regression specification. We find that tax effects are significantly different depending on the orientation of DEA scores. Notably, we observe that taxation presents stronger detrimental effects to input-oriented scores in comparison to output-oriented, and that Opportunity PSP indicators seem more affected by property taxes and working contributions, while Musgravian PSP indicators are more closely related to individual and corporate income taxes. Our results allow us to provide policy implications regarding better tax structures to improve efficiency on the provision of public goods and services.
- The role of global uncertainty in shaping trade flow relations : a cross-country analysis for EuropePublication . Afonso, António; Alves, José; Menescal, Lucas; Monteiro, SofiaWe examine the effects of World Uncertainty and Geopolitical Risk on Trade flows for 31 European economies between 1995 and 2023. To do so, we resort to Panel estimation techniques, including OLS and Poisson Pseudo Maximum Likelihood (PPML). Our findings reveal that European nations primarily respond to global uncertainty by concentrating their exports and imports among top trading partners particularly their top 5 highest trading partners. This result is more pronounced when uncertainty is driven by low-income countries. Moreover, there is a stronger relationship between imports and global uncertainty compared to exports. Our study underscores the importance of European economies strategically adapting their export and import approaches in response to these challenges.