An Optimal-Tax Approach to Alcohol Policy
This paper deals with optimal income and commodity taxation in an economy, where alcohol is an externality-generating consumption good. In our model, alcohol can be bought domestically, imported, or produced illegally. Border trade alone implies an incentive to set the domestic alcohol tax below the marginal social damage of alcohol, and to tax (subsidize) commodities that are complementary with (substitutable for) alcohol. The income tax will also be used as a corrective instrument. Furthermore, although the effects of adding illegal production are ambiguous in general, a realistic outcome is, nevertheless, that it reduces both the optimal alcohol tax and the marginal income tax rate.
Volume (Year): 66 (2010)
Issue (Month): 2 (June)
|Contact details of provider:|| Web page: https://www.mohr.de/fa|
|Order Information:|| Postal: Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany|
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.:
- Ian Crawford & Sarah Tanner, 1995. "Bringing it all back home: alcohol taxation and cross-border shopping," Fiscal Studies, Institute for Fiscal Studies, vol. 16(2), pages 94-114, May.
- Aronsson, Thomas & Sjögren, Tomas, 2002.
"Is the Optimal Labor Income Tax Progressive in a Unionized Economy?,"
Umeå Economic Studies
587, Umeå University, Department of Economics.
- Thomas Aronsson & Tomas Sjögren, 2004. "Is the Optimal Labor Income Tax Progressive in a Unionized Economy?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 106(4), pages 661-675, December.
- Christiansen, Vidar, 1984. "Which commodity taxes should supplement the income tax?," Journal of Public Economics, Elsevier, vol. 24(2), pages 195-220, July.
- Aronsson, Thomas & Sjogren, Tomas, 2004. "Efficient taxation, wage bargaining and policy coordination," Journal of Public Economics, Elsevier, vol. 88(12), pages 2711-2725, December.
- Aronsson, Thomas & Thunström, Linda, 2008. "A note on optimal paternalism and health capital subsidies," Economics Letters, Elsevier, vol. 101(3), pages 241-242, December.
- Blomquist, Sören & Micheletto, Luca, 2003.
"Age Related Optimal Income Taxation,"
Working Paper Series
2003:7, Uppsala University, Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:mhr:finarc:urn:sici:0015-2218(201006)66:2_153:aoatap_2.0.tx_2-b. 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: (Thomas Wolpert)
If references are entirely missing, you can add them using this form.