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On Pareto improving commodity tax changes under fiscal competition

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  • de CROMBRUGGHE, Alain
  • TULKENS, Henry

Abstract

This paper shows that when a ‘noncooperative fiscal equilibrium’ of the Mintz-Tulkens 1986 model of tax competition is inefficient, Pareto improving changes are positive for the taxes of both regions, under concavity of the regions’ welfare functions. It also identifies a class of such equilibria that are always efficient.
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Suggested Citation

  • de CROMBRUGGHE, Alain & TULKENS, Henry, 1990. "On Pareto improving commodity tax changes under fiscal competition," LIDAM Reprints CORE 895, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvrp:895
    DOI: 10.1016/0047-2727(90)90065-P
    Note: In : Journal of Public Economics, 41, 335-350, 1990
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