Theory of tax smoothing in the small open economy

Lance A. Fisher, Geoffrey H. Kingston*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)


We derive necessary and sufficient conditions for the martingale-like behavior of tax rates. The world real interest rate is exogenous to the small domestic economy. Consumers are risk averse and markets are incomplete. The government's loss function is not ad hoc.

Original languageEnglish
Pages (from-to)1-7
Number of pages7
JournalEconomics Letters
Issue number1
Publication statusPublished - Oct 2004
Externally publishedYes


  • Incomplete markets
  • Martingale
  • Ramsey problem
  • Small open economy


Dive into the research topics of 'Theory of tax smoothing in the small open economy'. Together they form a unique fingerprint.

Cite this