Optimal commodity grouping in a partial equilibrium framework
AbstractThe literature on indirect taxation is usually concerned with the casewhere the number of possible diÂ¤erent tax rates equals the number of commodities.The purpose of this paper is to characterize, in a partial equilibrium framework,which commodities should be taxed at the same rate whenever there is only onepossible tax rate. It is shown that if all the consumers are endowed with thesame weight by the social planner, i.e., in the representative agent conâ¦guration,then necessities should be taxed while luxuries should be exempted from taxation.In the many-person conâ¦guration, where diÂ¤erent individuals have diÂ¤erent socialweights, only one commodity should be taxed; it is the one that is mainly consumedby households with low social weights.
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Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 83 (2004)
Issue (Month): 1 (April)
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Web page: http://www.elsevier.com/locate/ecolet
Other versions of this item:
- Pascal Belan & Stéphane Gauthier, 2004. "Optimal commodity grouping in a partial equilibrium framework," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00106895, HAL.
- Pascal Belan & Stéphane Gauthier, 2003. "Optimal Commodity Grouping in a Partial Equilibrium Framework," Working Papers 2003-28, Centre de Recherche en Economie et Statistique.
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.:
- Baumol, William J & Bradford, David F, 1970. "Optimal Departures from Marginal Cost Pricing," American Economic Review, American Economic Association, vol. 60(3), pages 265-83, June.
- Yitzhaki, Shlomo, 1979. "A Note on Optimal Taxation and Administrative Costs," American Economic Review, American Economic Association, vol. 69(3), pages 475-80, June.
- Belan, Pascal & Gauthier, Stéphane & Laroque, Guy, 2008.
"Optimal grouping of commodities for indirect taxation,"
Journal of Public Economics,
Elsevier, vol. 92(7), pages 1738-1750, July.
- Pascal Belan & Stéphane Gauthier & Guy Laroque, 2008. "Optimal grouping of commodities for indirect taxation," Post-Print hal-00731151, HAL.
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