Influence Of Demographic Variables On Indirect Tax Setting For Selected Indian States
AbstractThis paper attempts to provide conclusive evidence in favor of sensitivity of optimal commodity taxes to demographic variables. This involves estimating optimal commodity taxes for the chosen 16 Indian states, incorporating demographic profiles for each state using NSS data. Such calculations are further done under alternative welfare weights for each household. The results reveal that the introduction of demographic variables in the demand system makes the tax rates more non-uniform across commodities and across states, and significantly alters their response to changes in the social planner's perception of a household's welfare. These effects are more pronounced for certain commodities that are basic and essential in a household's basket. Differences in welfare weights also have a similar effect on tax rates, though to a lesser degree.
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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by World Scientific Publishing Co. Pte. Ltd. in its journal The Singapore Economic Review.
Volume (Year): 53 (2008)
Issue (Month): 02 ()
Contact details of provider:
Web page: http://www.worldscinet.com/ser/ser.shtml
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.:
- James Banks & Richard Blundell & Arthur Lewbel, 1994.
"Tax reform and welfare measurement: do we need demand system estimation?,"
IFS Working Papers
W94/11, Institute for Fiscal Studies.
- Banks, James & Blundell, Richard & Lewbel, Arthur, 1996. "Tax Reform and Welfare Measurement: Do We Need Demand System Estimation?," Economic Journal, Royal Economic Society, vol. 106(438), pages 1227-41, September.
- Harris, Richard G. & Mackinnon, James G., 1979. "Computing optimal tax equilibria," Journal of Public Economics, Elsevier, vol. 11(2), pages 197-212, March.
- Michael Cragg, 1991. "Do We Care? A Study of Canada's Indirect Tax System," Canadian Journal of Economics, Canadian Economics Association, vol. 24(1), pages 124-43, February.
- Madden, David, 1995. "Labour Supply, Commodity Demand and Marginal Tax Reform," Economic Journal, Royal Economic Society, vol. 105(429), pages 485-97, March.
- Ray, Ranjan, 1986. "Sensitivity of `optimal' commodity tax rates to alternative demand functional forms : An econometric case study of India," Journal of Public Economics, Elsevier, vol. 31(2), pages 253-268, November.
- Nicita, Alessandro, 2004. "Efficiency and equity of a marginal tax reform - income, quality, and price elasticities for Mexico," Policy Research Working Paper Series 3266, The World Bank.
- Blundell, Richard & Ray, Ranjan, 1984. "Testing for Linear Engel Curves and Additively Separable Preferences Using a New Flexible Demand System," Economic Journal, Royal Economic Society, vol. 94(376), pages 800-811, December.
- Roberts, Kevin, 1980.
"Price-Independent Welfare Prescriptions,"
Springer, vol. 13(3), pages 277-97, June.
- Blacklow, P. & Ray, R., 2000. "Optimal Commodity Taxes in Australia and their Sensitivity to Consumer Preference and Demographic Specification," Papers 2001-01, Tasmania - Department of Economics.
- Decoster, Andre & Schokkaert, Erik, 1990. "Tax reform results with different demand systems," Journal of Public Economics, Elsevier, vol. 41(3), pages 277-296, April.
- Pollak, Robert A & Wales, Terence J, 1981. "Demographic Variables in Demand Analysis," Econometrica, Econometric Society, vol. 49(6), pages 1533-51, November.
- Ray, Ranjan, 1985. "A dynamic analysis of expenditure patterns in rural India," Journal of Development Economics, Elsevier, vol. 19(3), pages 283-297, December.
- Gordon, Roger & Li, Wei, 2009.
"Tax structures in developing countries: Many puzzles and a possible explanation,"
Journal of Public Economics,
Elsevier, vol. 93(7-8), pages 855-866, August.
- Roger Gordon & Wei Li, 2005. "Tax Structure in Developing Countries: Many Puzzles and a Possible Explanation," NBER Working Papers 11267, National Bureau of Economic Research, Inc.
- Ahmad, Ehtisham & Stern, Nicholas, 1984. "The theory of reform and indian indirect taxes," Journal of Public Economics, Elsevier, vol. 25(3), pages 259-298, December.
- Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
- Murty, M N & Ray, Ranjan, 1989. " A Computational Procedure for Calculating Optimal Commodity Taxes with Illustrative Evidence from Indian Budget Data," Scandinavian Journal of Economics, Wiley Blackwell, vol. 91(4), pages 655-70.
- Paul Blacklow & Ranjan Ray, 2002. "Optimal Commodity Taxes in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(1), pages 45-54.
- Majumder, Amita, 1988. "A note on optimal commodity taxation in India," Economics Letters, Elsevier, vol. 27(2), pages 167-171.
- J. V. Meenakshi & Ranjan Ray, 1999.
"Regional differences in India's food expenditure pattern: a complete demand systems approach,"
Journal of International Development,
John Wiley & Sons, Ltd., vol. 11(1), pages 47-74.
- Meenakshi, J.V. & Ray, R., 1996. "Regional Differences in India's Food Expenditure Pattern: A Complete Demand Systems Approach," Papers 1996-06, Tasmania - Department of Economics.
- Ray, Ranjan, 1980. "Analysis of a Time Series of Household Expenditure Surveys for India," The Review of Economics and Statistics, MIT Press, vol. 62(4), pages 595-602, November.
- Slivinski, Alan D., 1983. "Income distribution evaluation and the law of one price," Journal of Public Economics, Elsevier, vol. 20(1), pages 103-112, February.
- Atkinson, A. B. & Stiglitz, J. E., 1972. "The structure of indirect taxation and economic efficiency," Journal of Public Economics, Elsevier, vol. 1(1), pages 97-119, April.
- Seki Asano & Takashi Fukushima, 2006. "Some Empirical Evidence On Demand System And Optimal Commodity Taxation," The Japanese Economic Review, Japanese Economic Association, vol. 57(1), pages 50-68.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Tai Tone Lim).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.