Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/70098
Authors: 
Vetter, Henrik
Year of Publication: 
2013
Citation: 
[Journal:] Economics: The Open-Access, Open-Assessment E-Journal [Volume:] 7 [Issue:] 2013-6 [Pages:] 1-13
Abstract: 
A digressive tax such as a variable rate sales tax or a tax on price gives firms an incentive for expanding output. Thus, unlike unit and ad valorem taxes which amplify the harm from monopoly, a digressive tax lessens the harm. We analyse a tax on price with respect to efficiency and practical policy appeal. In particular, we show how tax reforms based only on observation of price and quantity can make use of a tax on price in order to improve welfare. That is, it is practical to use a tax on price. The argument extends to fixed-number homogenous oligopoly.
Subjects: 
tax on price
ad valorem tax
tax incidence
JEL: 
H21
L13
Persistent Identifier of the first edition: 
Creative Commons License: 
http://creativecommons.org/licenses/by/3.0/
Document Type: 
Article

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