Author(s):	V. V. Chari, Juan Pablo Nicolini, Pedro Teles
Publication Date:	February 2018
Keyword(s):	border adjustment, Capital income tax, free trade, origin- and destination-based taxation, production e, value-added taxes
JEL(s):	E60, E61, E62
Programme Areas:	International Macroeconomics and Finance
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=12753

We study cooperative optimal Ramsey equilibria in the open economy addressing classic policy questions: Should restrictions be placed to free trade and capital mobility? Should capital income be taxed? Should goods be taxed based on origin or destination? What are desirable border adjustments? How can a Ramsey allocation be implemented with residence-based taxes on assets? We characterize optimal wedges and analyze alternative policy implementations.