SFB 303 Discussion Paper No. B - 430

Author: Ackermann, Michael B. E., and Norbert Christopeit
Title: The Time Optimal Transition of Eastern Germany's Productivity
Abstract: In this paper the time optimal trajectories of the solidarity tax and the fraction of tax revenues allocated as additional investment to Eastern Germany are developed. A thorough analysis of the necessary as well as the sufficient optimality conditions within the framework of a two-country neoclassical growth model results in the unique optimal tax rate and allocation policy.
Keywords: Optimal Control, Transition, Germany, Solidarity Tax
JEL-Classification-Number: C61, E13, E61, O41
Creation-Date: April 1998
URL: ../1998/b/bonnsfb430.pdf"

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