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Optimal Taxation with Joint Production of Agriculture and Rural Amenities

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Author Info
Casamatta, Georges
Rausser, Gordon
Simon, Leo K

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Abstract

We show that, when there is joint production of an agricultural good and rural amenities, the first-best allocation of resources can be implemented with a tax on the agricultural good and some subsidies on the production factors (land and labour). The use of a subsidy on the agricultural good can only be explained by the desire of the policymaker to redistribute income from the consumers to the farmers.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6615.

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Date of creation: Dec 2007
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Handle: RePEc:cpr:ceprdp:6615

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Related research
Keywords: joint production rural amenities

Find related papers by JEL classification:
H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General

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This page was last updated on 2008-8-19.

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