Commodity taxation and parallel imports
We examine the interaction between commodity taxes and parallel imports in a two-country model with imperfect competition. While governments determine non-cooperatively their commodity tax rate, the volume of parallel imports is determined endogenously by the retailing sector. We compare the positive and normative implications of having commodity taxes based on destination or origin principle. We show that, as the volume of parallel imports increases, non-cooperative origin taxes converge, while destination taxes diverge. Moreover, origin taxes are more similar and lead to higher aggregate welfare levels than destination taxes.
If 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.
References listed on IDEAS
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.:
- Gene M. Grossman & Edwin C.-L. Lai, 2006.
"Parallel Imports and Price Controls,"
NBER Working Papers
12423, National Bureau of Economic Research, Inc.
- Malueg, D.A. & Schwartz, M., 1993.
"Parallel Imports, Demand Dispersion and International Price Discrimination,"
93-6, U.S. Department of Justice - Antitrust Division.
- Malueg, David A. & Schwartz, Marius, 1994. "Parallel imports, demand dispersion, and international price discrimination," Journal of International Economics, Elsevier, vol. 37(3-4), pages 167-195, November.
- Raff, Horst & Schmitt, Nicolas, 2005.
"Why Parallel Trade May Raise Producers' Profits,"
Economics Working Papers
2005,07, Christian-Albrechts-University of Kiel, Department of Economics.
- Andreas HaufLer & Guttorm Schjelderup & Frank Stähler, 2005.
"Barriers to Trade and Imperfect Competition: The Choice of Commodity Tax Base,"
International Tax and Public Finance,
Springer;International Institute of Public Finance, vol. 12(3), pages 281-300, May.
- Haufler, Andreas & Schjelderup, Guttorm & Stähler, Frank, 2005. "Barriers to trade and imperfect competition: The choice of commodity tax base," Munich Reprints in Economics 20414, University of Munich, Department of Economics.
- Keen, Michael & Lahiri, Sajal, 1994.
"The Comparison Between Destination and Origin Principles Under Imperfect Competition,"
Economics Discussion Papers
10023, University of Essex, Department of Economics.
- Keen, Michael & Lahiri, Sajal, 1998. "The comparison between destination and origin principles under imperfect competition," Journal of International Economics, Elsevier, vol. 45(2), pages 323-350, August.
- Michael Keen & Sajal Lahiri, 1994. "The comparison between destination and origin principles under imperfect competition," IFS Working Papers W94/08, Institute for Fiscal Studies.
- Keen, Michael & Lahiri, Sajal & Raimondos-Moller, Pascalis, 2002.
"Tax principles and tax harmonization under imperfect competition: A cautionary example,"
European Economic Review,
Elsevier, vol. 46(8), pages 1559-1568, September.
- Michael Keen & Sajal Lahiri & Pascalis Raimondos-Møller, 2001. "Tax Principles and Tax Harmonization under Imperfect Competition: A Cautionary Example," CESifo Working Paper Series 518, CESifo Group Munich.
- Maskus, Keith E. & Yongmin Chen, 2000.
"Vertical price control and parallel imports - theory and evidence,"
Policy Research Working Paper Series
2461, The World Bank.
- Keith E. Maskus & Yongmin Chen, 2004. "Vertical Price Control and Parallel Imports: Theory and Evidence," Review of International Economics, Wiley Blackwell, vol. 12(4), pages 551-570, 09.
- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, September.
- Keen, Michael & Lahiri, Sajal, 1993. "Domestic tax reform and international oligopoly," Journal of Public Economics, Elsevier, vol. 51(1), pages 55-74, May.
- Andreas Haufler & Michael Pflüger, 2007.
"International Oligopoly and the Taxation of Commerce with Revenue-Constrained Governments,"
London School of Economics and Political Science, vol. 74(295), pages 451-473, 08.
- Haufler, Andreas & Pflüger, Michael, 2007. "International oligopoly and the taxation of commerce with revenue-constrained governments," Munich Reprints in Economics 20424, University of Munich, Department of Economics.
- Ganslandt, Mattias & Maskus, Keith E., 2005.
"Vertical Distribution, Parallel Trade, and Price Divergence in Integrated Markets,"
Working Paper Series
639, Research Institute of Industrial Economics.
- Ganslandt, Mattias & Maskus, Keith E., 2007. "Vertical distribution, parallel trade, and price divergence in integrated markets," European Economic Review, Elsevier, vol. 51(4), pages 943-970, May.
- Panos Kanavos & Joan Costa-Font, 2005. "Pharmaceutical parallel trade in Europe: stakeholder and competition effects," Economic Policy, CEPR;CES;MSH, vol. 20(44), pages 751-798, October.
- Reza Ahmadi & B. Rachel Yang, 2000. "Parallel Imports: Challenges from Unauthorized Distribution Channels," Marketing Science, INFORMS, vol. 19(3), pages 279-294, March.
- Li, Changying & Maskus, Keith E., 2006. "The impact of parallel imports on investments in cost-reducing research and development," Journal of International Economics, Elsevier, vol. 68(2), pages 443-455, March.
- Keith E. Maskus, 2000. "Parallel Imports," The World Economy, Wiley Blackwell, vol. 23(9), pages 1269-1284, 09.
- Lockwood, B., 2000.
"Tax Competition and Tax Co-Ordination Under Destination and Origin Principles: A Synthesis,"
The Warwick Economics Research Paper Series (TWERPS)
567, University of Warwick, Department of Economics.
- Lockwood, Ben, 2001. "Tax competition and tax co-ordination under destination and origin principles: a synthesis," Journal of Public Economics, Elsevier, vol. 81(2), pages 279-319, August.
- Gene M. Grossman & Edwin L.-C. Lai, 2008.
"Parallel imports and price controls,"
RAND Journal of Economics,
RAND Corporation, vol. 39(2), pages 378-402.
- Yongmin Chen & Keith Maskus, 2005. "Vertical Pricing and Parallel Imports," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 14(1), pages 1-18.
When requesting a correction, please mention this item's handle: RePEc:eee:pubeco:v:94:y:2010:i:1-2:p:153-162. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
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.