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Vertical and horizontal tax competition in the transport sector

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Author Info
Bruno de Borger
Stef Proost

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Abstract

The purpose of this paper is to review the literature dealing with horizontal and vertical tax competition in the transport sector, taking into account the role of transport externalities. Our emphasis throughout is on tax competition between governments, not between private suppliers. For the various different settings (horizontal and vertical competition, parallel and serial networks), we discuss the relevance of tax competition and describe the type of results typically obtained. We further point out the relevance of different types of tax competition for transport policy in a European setting. Finally, we discuss the losses of non-cooperative behaviour of governments.

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Article provided by De Boeck Université in its journal Reflets et perspectives de la vie économique.

Volume (Year): XLIII (2004)
Issue (Month): 4 ()
Pages: 45-64
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Handle: RePEc:cai:rpvedb:rpve_434_0045

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Erik Teodoor Verhoef & Jan Rouwendal, 2003. "Pricing, Capacity Choice and Financing in Transportation Networks," ERSA conference papers ersa03p41, European Regional Science Association. [Downloadable!]
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  2. David Levinson, 2001. "Why States Toll: An Empirical Model of Finance Choice," Journal of Transport Economics and Policy, London School of Economics and University of Bath, vol. 35(2), pages 223-237, May. [Downloadable!] (restricted)
  3. Andreas Haufler, 1996. "Optimal factor and commodity taxation in a small open economy," International Tax and Public Finance, Springer, vol. 3(4), pages 523-527, October. [Downloadable!] (restricted)
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  4. DE BORGER, Bruno & PROOST, Stef & VAN DENDER, Kurt, 2004. "Congestion and tax competition in a parallel network," CORE Discussion Papers 2004018, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
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  5. Michael Keen & Christos Kotsogiannis, 2003. "Leviathan and Capital Tax Competition in Federations," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 5(2), pages 177-199, 04. [Downloadable!] (restricted)
  6. BOADWAY, Robin & MARCHAND, Maurice & VIGNEAULT, Marianne, 1998. "The consequences of overlapping tax bases for redistribution and public spending in a federation," CORE Discussion Papers 1998003, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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  7. Braid, Ralph M., 1996. "Peak-Load Pricing of a Transportation Route with an Unpriced Substitute," Journal of Urban Economics, Elsevier, vol. 40(2), pages 179-197, September. [Downloadable!] (restricted)
  8. Hoyt, William H., 2001. "Tax Policy Coordination, Vertical Externalities, and Optimal Taxation in a System of Hierarchical Governments," Journal of Urban Economics, Elsevier, vol. 50(3), pages 491-516, November. [Downloadable!] (restricted)
  9. Thomas Bjørner, 1996. "Any need for coordination of policies towards transit traffic with a negative local externality?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 8(2), pages 221-245, September. [Downloadable!] (restricted)
  10. Wildasin, David E., 1989. "Interjurisdictional capital mobility: Fiscal externality and a corrective subsidy," Journal of Urban Economics, Elsevier, vol. 25(2), pages 193-212, March. [Downloadable!] (restricted)
  11. Janeba, Eckhard & Peters, Wolfgang, 1999. "Tax Evasion, Tax Competition and the Gains from Nondiscrimination: The Case of Interest Taxation in Europe," Economic Journal, Royal Economic Society, vol. 109(452), pages 93-101, January. [Downloadable!] (restricted)
  12. Erik T. Verhoef & Kenneth A. Small, 1999. "Product Differentiation on Roads: Second-Best Congestion Pricing with Heterogeneity under Public and Private Ownership," Tinbergen Institute Discussion Papers 99-066/3, Tinbergen Institute. [Downloadable!]
  13. Thorsten Bayindir-Upmann, 1998. "Two Games of Interjurisdictional Competition When Local Governments Provide Industrial Public Goods," International Tax and Public Finance, Springer, vol. 5(4), pages 471-487, October. [Downloadable!] (restricted)
  14. Wildasin, David E., 1988. "Nash equilibria in models of fiscal competition," Journal of Public Economics, Elsevier, vol. 35(2), pages 229-240, March. [Downloadable!] (restricted)
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  15. Richard J. Arnott & Ronald E. Grieson, 1978. "Optimal Fiscal Policy for State and Local Government," Working Papers 291, Queen's University, Department of Economics.
  16. Bucovetsky, S., 1991. "Asymmetric tax competition," Journal of Urban Economics, Elsevier, vol. 30(2), pages 167-181, September. [Downloadable!] (restricted)
  17. Kehoe, Patrick J, 1989. "Policy Cooperation among Benevolent Governments May Be Undesirable," Review of Economic Studies, Blackwell Publishing, vol. 56(2), pages 289-96, April. [Downloadable!] (restricted)
  18. Bev Dahlby, 1996. "Fiscal externalities and the design of intergovernmental grants," International Tax and Public Finance, Springer, vol. 3(3), pages 397-412, July. [Downloadable!] (restricted)
  19. Dixit, Avinash & Grossman, Gene M & Helpman, Elhanan, 1997. "Common Agency and Coordination: General Theory and Application to Government Policy Making," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 752-69, August.
  20. Verhoef, Erik & Nijkamp, Peter & Rietveld, Piet, 1996. "Second-Best Congestion Pricing: The Case of an Untolled Alternative," Journal of Urban Economics, Elsevier, vol. 40(3), pages 279-302, November. [Downloadable!] (restricted)
  21. Janeba, Eckhard, 1998. "Tax competition in imperfectly competitive markets," Journal of International Economics, Elsevier, vol. 44(1), pages 135-153, February. [Downloadable!] (restricted)
  22. Black, Dan A & Hoyt, William H, 1989. "Bidding for Firms," American Economic Review, American Economic Association, vol. 79(5), pages 1249-56, December. [Downloadable!] (restricted)
  23. Kraus, Marvin, 2003. "A new look at the two-mode problem," Journal of Urban Economics, Elsevier, vol. 54(3), pages 511-530, November. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Barry Ubbels & Erik Verhoef, 2006. "Governmental Competition in Road Charging and Capacity Choice," Tinbergen Institute Discussion Papers 06-036/3, Tinbergen Institute, revised 10 Sep 2007. [Downloadable!]
    Other versions:
  2. Andre de Palma & Lindsey Robin & Proost Stef, 2005. "Research challenges in modelling urban road pricing: an overview," Energy, Transport and Environment Working Papers Series ete0506, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment. [Downloadable!]
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