In an economy with heterogeneous firms and heterogeneous consumers, the authors describe a general equilibrium where firm equity is priced by a supply and demand process. With a model robust to arbitrary, nonlinear tax functions, they investigate the efficiency of replacing the current U.S. tax regime with a policy of no corporate taxes and taxation of capital distributions to the household at progressive personal income tax rates.
This working paper analyzes the prospects of Iran changing its domestic and foreign policy behavior over the longer term, and outlines what the United States and others can do to promote such changes.