Tax Policy, Housing, and the Labour Market: An Intertemporal Simulation Approach

Svend E. Hougaard Jensen, Søren Bo Nielsen, Lars Haagen Pedersen, Peter Birch Sørensen

Research output: Contribution to journalJournal articleResearchpeer-review


This paper develops an intertemporal simulation model designed to analyse tax policies in a small open economy. Within a finite horizon, overlapping generations framework, we introduce imperfect competition in the labour market, consumption and construction of durables in the form of housing units, and a public pension system. We simulate the model to illustrate some macroeconomic, allocative and distributional effects of a policy experiment involving a 10% cut in the capital income tax rate.
Original languageEnglish
JournalEconomic Modelling
Issue number3
Pages (from-to)255-382
Number of pages28
Publication statusPublished - Jul 1996


  • Capital income taxation
  • Wage formation
  • Intergenerational welfare

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