The comparative efficiency of ad valorem and specific taxes under monopoly and monopsony
نویسندگان
چکیده
منابع مشابه
The comparative efficiency of ad valorem and specific taxes under monopoly and monopsony
It is well known that ad valorem taxes welfare-dominate specific taxes under monopoly. This paper demonstrates that the comparative welfare ranking of the two instruments reverses under monopsony. The relative performance of alternative tax forms is thus highly sensitive to whether the buyer or seller has market power.
متن کاملUnit versus ad valorem taxes: Monopoly in general equilibrium
We show that if a monopoly sector is imbedded in a general equilibrium framework and profits are taxed at one hundred percent, then unit (specific) taxation and ad valorem taxation are welfare-wise equivalent. This is contrary to all known claims. Journal of Economic Literature Classification Number:H21
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This note shows that in the Zodrow-Miesowski-Wilson model, the Nash equilibrium in capital taxes depends on whether these taxes are unit (as assumed in the literature) or ad valorem (as in reality). In a symmetric version of the model with Cobb-Douglas technology, public good provision is higher, and residents in both countries are better off, when countries compete in unit taxes.
متن کاملFailure of Ad Valorem and Specific Tax Equivalence under Uncertainty
Applying a framework of perfect competition under uncertainty, we contribute to the discussion of whether or not ad valorem taxes and specific taxes are equivalent. While this equivalence holds without price uncertainty, we show that ad valorem taxes and specific taxes are “almost never” equivalent in the presence of uncertainty if we demand equivalence to hold pathwise. Since we obtain this re...
متن کاملThe Comparison Between Ad Valorem and Unit Taxes under Monopolistic Competition
This paper shows that the welfare dominance of ad valorem over unit taxes under imperfect competition, extends to the Dixit-Stiglitz framework with differentiated products, entry and love of variety. This contrasts against findings by Anderson et al. (J Public Econ, 2001) made in a similar framework, but under Bertrand competition.
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ژورنال
عنوان ژورنال: Economics Letters
سال: 1999
ISSN: 0165-1765
DOI: 10.1016/s0165-1765(99)00018-x