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dc.contributor.authorSeißer, Goetzen_US
dc.date.accessioned2009-08-12T07:14:44Z-
dc.date.available2009-08-12T07:14:44Z-
dc.date.issued2008en_US
dc.identifier.urihttp://hdl.handle.net/10419/27464-
dc.description.abstractThis paper addresses the reduction of market failure under imperfect competition. It proposes a taxscheme that provides firms with an incentive to forgo their market power: Firms optimize after-tax profits. Now simply consider a firm´s gross profit margin the unique tax-rate it is charged on absolute profits. In theory the firm´s tax-rate would be the mark-up over marginal costs, the firm´s Lerner index. As a result every firm determines its own tax-rate by setting its price and incurring costs. This creates a new trade off for firms between a low tax-burden and the exercising of market power. Welfare for society increases since firms with market power choose a lower price and produce a quantity closer or equal to social optimum; at the original monopolistic price-level they can increase their profits by lowering their tax-burden. Essentially the tax-condition does not seem to distort profit incentives or markets; under perfect competition the tax-rate would be zero. Thus, it is clear that the tax only takes effect when markets work inefficiently and its countervailing nature subsequently helps to remedy inefficiencies of imperfectly competitive markets.en_US
dc.language.isoengen_US
dc.publisherKiel Institute for the World Economy (IfW) Kielen_US
dc.relation.ispartofseriesEconomics Discussion Papers / Institut für Weltwirtschaft 2008-28en_US
dc.subject.jelH21en_US
dc.subject.jelD40en_US
dc.subject.jelD21en_US
dc.subject.jelP11en_US
dc.subject.jelH26en_US
dc.subject.jelH25en_US
dc.subject.jelD00en_US
dc.subject.ddc330en_US
dc.subject.keywordImperfect competitionen_US
dc.subject.keywordmarket poweren_US
dc.subject.keywordtax-conditionen_US
dc.subject.keywordmonopolyen_US
dc.subject.keywordwelfareen_US
dc.subject.keywordefficiencyen_US
dc.subject.stwSteuerpolitiken_US
dc.subject.stwUnvollkommener Wettbewerben_US
dc.subject.stwOptimale Besteuerungen_US
dc.subject.stwMarktmachten_US
dc.subject.stwWohlfahrtseffekten_US
dc.subject.stwTheorieen_US
dc.titlePerfecting Imperfect Competitionen_US
dc.typeWorking Paperen_US
dc.identifier.ppn579782557en_US
dc.rights.licensehttp://creativecommons.org/licenses/by-nc/2.0/de/deed.en-
dc.identifier.repecRePEc:zbw:ifwedp:7404-
Appears in Collections:Economics: The Open-Access, Open-Assessment E-Journal - Discussion Papers

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