Stretching the Inelastic Rubber: Taxation, Welfare and Lobbies in Amazonia, 1870-1910
AbstractThis paper examines the effect of government intervention via taxation on domestic welfare. A case-study of Brazilian market power on rubber markets during the boom years of 1870-1910 shows that the government generated 1.3% of GDP through an export tax on rubber but that it could have generated 4.7% in total, had the government set the tariff at the optimal level. National, regional and local constraints prevented the government from maximizing regional welfare. In a context of lobbies, government budget maximization may have differed from regional welfare maximization.
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Bibliographic InfoPaper provided by Harvard Business School in its series Harvard Business School Working Papers with number 10-032.
Length: 43 pages
Date of creation: Oct 2009
Date of revision:
Rubber; Commodities; Market Power; Optimal Tariff; Welfare; Trade and Brazil.;
Find related papers by JEL classification:
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L73 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Forest Products
- N76 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Latin America; Caribbean
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-10-31 (All new papers)
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