Commodity taxation and parallel imports
AbstractWe examine the interaction between commodity taxes and parallel imports in a two-country model with imperfect competition. While governments determine non-cooperatively their commodity tax rate, the volume of parallel imports is determined endogenously by the retailing sector. We compare the positive and normative implications of having commodity taxes based on destination or origin principle. We show that, as the volume of parallel imports increases, non-cooperative origin taxes converge, while destination taxes diverge. Moreover, origin taxes are more similar and lead to higher aggregate welfare levels than destination taxes.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Public Economics.
Volume (Year): 94 (2010)
Issue (Month): 1-2 (February)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505578
Parallel import Commodity taxation Tax harmonization;
Other versions of this item:
- Raimondos-Møller, Pascalis & Schmitt, Nicolas, 2007. "Commodity Taxation and Parallel Imports," Working Papers 04-2007, Copenhagen Business School, Department of Economics.
- Raimondos-Møller, Pascalis & Schmitt, Nicolas, 2007. "Commodity Taxation and Parallel Imports," CEPR Discussion Papers 6580, C.E.P.R. Discussion Papers.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F15 - International Economics - - Trade - - - Economic Integration
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
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.:
- Malueg, David A. & Schwartz, Marius, 1994.
"Parallel imports, demand dispersion, and international price discrimination,"
Journal of International Economics,
Elsevier, vol. 37(3-4), pages 167-195, November.
- Malueg, D.A. & Schwartz, M., 1993. "Parallel Imports, Demand Dispersion and International Price Discrimination," Papers 93-6, U.S. Department of Justice - Antitrust Division.
- Keen, Michael & Lahiri, Sajal, 1998.
"The comparison between destination and origin principles under imperfect competition,"
Journal of International Economics,
Elsevier, vol. 45(2), pages 323-350, August.
- Michael Keen and Sajal Lahiri, . "The Comparison Between Destination and Origin Principles Under Imperfect Competition," Economics Discussion Papers 424, University of Essex, Department of Economics.
- Michael Keen & Sajal Lahiri, 1994. "The comparison between destination and origin principles under imperfect competition," IFS Working Papers W94/08, Institute for Fiscal Studies.
- Reza Ahmadi & B. Rachel Yang, 2000. "Parallel Imports: Challenges from Unauthorized Distribution Channels," Marketing Science, INFORMS, vol. 19(3), pages 279-294, March.
- Lockwood, B., 2000.
"Tax Competition and Tax Co-Ordination Under Destination and Origin Principles: A Synthesis,"
The Warwick Economics Research Paper Series (TWERPS)
567, University of Warwick, Department of Economics.
- Lockwood, Ben, 2001. "Tax competition and tax co-ordination under destination and origin principles: a synthesis," Journal of Public Economics, Elsevier, vol. 81(2), pages 279-319, August.
- Li, Changying & Maskus, Keith E., 2006. "The impact of parallel imports on investments in cost-reducing research and development," Journal of International Economics, Elsevier, vol. 68(2), pages 443-455, March.
- Keith E. Maskus, 2000. "Parallel Imports," The World Economy, Wiley Blackwell, vol. 23(9), pages 1269-1284, 09.
- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, December.
- Haufler, Andreas & Schjelderup, Guttorm & Stähler, Frank, 2005.
"Barriers to trade and imperfect competition: The choice of commodity tax base,"
Munich Reprints in Economics
20414, University of Munich, Department of Economics.
- Andreas HaufLer & Guttorm Schjelderup & Frank Stähler, 2005. "Barriers to Trade and Imperfect Competition: The Choice of Commodity Tax Base," International Tax and Public Finance, Springer, vol. 12(3), pages 281-300, May.
- Raff, Horst & Schmitt, Nicolas, 2005.
"Why Parallel Trade May Raise Producers' Profits,"
Economics Working Papers
2005,07, Christian-Albrechts-University of Kiel, Department of Economics.
- Yongmin Chen & Keith Maskus, 2005. "Vertical Pricing and Parallel Imports," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 14(1), pages 1-18.
- Maskus, Keith E. & Yongmin Chen, 2000.
"Vertical price control and parallel imports - theory and evidence,"
Policy Research Working Paper Series
2461, The World Bank.
- Keith E. Maskus & Yongmin Chen, 2004. "Vertical Price Control and Parallel Imports: Theory and Evidence," Review of International Economics, Wiley Blackwell, vol. 12(4), pages 551-570, 09.
- Panos Kanavos & Joan Costa-Font, 2005. "Pharmaceutical parallel trade in Europe: stakeholder and competition effects," Economic Policy, CEPR & CES & MSH, vol. 20(44), pages 751-798, October.
- Gene M. Grossman & Edwin L.-C. Lai, 2008.
"Parallel imports and price controls,"
RAND Journal of Economics,
RAND Corporation, vol. 39(2), pages 378-402.
- Keen, Michael & Lahiri, Sajal & Raimondos-Moller, Pascalis, 2002.
"Tax principles and tax harmonization under imperfect competition: A cautionary example,"
European Economic Review,
Elsevier, vol. 46(8), pages 1559-1568, September.
- Michael Keen & Sajal Lahiri & Pascalis Raimondos-Møller, 2001. "Tax Principles and Tax Harmonization under Imperfect Competition: A Cautionary Example," CESifo Working Paper Series 518, CESifo Group Munich.
- Ganslandt, Mattias & Maskus, Keith E., 2005.
"Vertical Distribution, Parallel Trade, and Price Divergence in Integrated Markets,"
Working Paper Series
639, Research Institute of Industrial Economics.
- Ganslandt, Mattias & Maskus, Keith E., 2007. "Vertical distribution, parallel trade, and price divergence in integrated markets," European Economic Review, Elsevier, vol. 51(4), pages 943-970, May.
- Keen, Michael & Lahiri, Sajal, 1993. "Domestic tax reform and international oligopoly," Journal of Public Economics, Elsevier, vol. 51(1), pages 55-74, May.
- Andreas Haufler & Michael Pflüger, 2007. "International Oligopoly and the Taxation of Commerce with Revenue-Constrained Governments," Economica, London School of Economics and Political Science, vol. 74(295), pages 451-473, 08.
- Rajat Acharyya & Maria D.C. Garcia-Alonso, 2010.
"Income Based Price Subsidies and Parallel Imports,"
Studies in Economics
1008, Department of Economics, University of Kent.
- Birg, Laura, 2013.
"Externalities of national pharmaceutical policy when markets are integrated through parallel trade,"
Center for European, Governance and Economic Development Research Discussion Papers
178, University of Goettingen, Department of Economics.
- Birg, Laura, 2013. "Externalities of national pharmaceutical policy when markets are integrated through parallel trade," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79720, Verein für Socialpolitik / German Economic Association.
- Arijit Mukherjee & Laixun Zhao, 2012. "Profitable parallel trade in unionized markets," Journal of Economics, Springer, vol. 107(3), pages 267-276, November.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If references are entirely missing, you can add them using this form.