Tag Archives: value added tax

the role of economic analysis - a reconsideration

A few days ago I went to the recruitment seminar of CREI, and the speaker was Dina Pomeranz from MIT. I don't know her before, but since both Ciccone and Azmat have mentioned her to me, I didn't want to miss her speech. So I was there.

I should admit that she made an interesting presentation. Her topic was pretty attractive - it was about VAT (value added tax). The title of her paper is "No Taxation without Information", and she mainly talks about the links among upstream and downstream firms in the VAT report process. It is pretty interesting that the information transmission plays such an vital role in this reporting cycle - how can we design an experiment/mechanism to prevent those firms from cheating/collusion.

Well, instead of repeating her presentation, I would like to talk about the role of economic analysis here. An interesting question is that: where do those people go after their postgraduate study in economics? I do not have the evidence, but I think that a big proportion of those economics students will end up being an analyst - especially those positions who offered by the government.  Then, they are doing economic analysis from the government's view, and offering advice for those policy makers. Perhaps it is the first time for me to realize that what can economic analysis provide for the running of the society. We are not only building those abstract and seemly useless models, but actually contributing to the constructions of several projects. That sounds somewhat great.