Emissions Taxation in Durable Goods Oligopoly
This paper examines the use of taxation to control external damage due to pollution when product durability is endogenously determined. A special form of the emissions function is also examined which is equivalent to an excise tax on output. The model indicates that many conventional results in the durability and taxation literature need not hold when durability is endogenously determined. The analysis shows durability may not be independent of industry structure nor will firms minimize their manufacturing costs of providing service. In addition, the second-best tax on imperfectly competitive firms is not necessarily less than the tax on a competitive firm with endogenous durability. Copyright 1999 by Blackwell Publishing Ltd
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Volume (Year): 47 (1999)
Issue (Month): 1 (March)
Pages: 125-143
| Handle: | RePEc:bla:jindec:v:47:y:1999:i:1:p:125-43 |
| Contact details of provider: | Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-1821
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