IDEAS home Printed from https://ideas.repec.org/a/taf/jeduce/v38y2007i4p435-445.html
   My bibliography  Save this article

The Long-Run Effect of a Tax-Rebate Program

Author

Listed:
  • Yuntong Wang

Abstract

In each period of a dynamic tax-rebate program, a (fixed) quantity tax is imposed on each unit of a given good, and the tax revenue is rebated back to the consumer in the next period. The program lasts for infinite number of periods. The author considers a representative consumer's dynamic consumption behavior, the long-run steady-state consumption, and the consumer's welfare. Under the standard continuity and strict convexity assumptions on the consumer's preferences, he shows that the tax strictly reduces the consumption of the good in each period as well as in the steady state, and the consumer is strictly worse off. He also provides numerical analysis when the consumer has the quasilinear or the Cobb-Douglas utility functions.

Suggested Citation

  • Yuntong Wang, 2007. "The Long-Run Effect of a Tax-Rebate Program," The Journal of Economic Education, Taylor & Francis Journals, vol. 38(4), pages 435-445, September.
  • Handle: RePEc:taf:jeduce:v:38:y:2007:i:4:p:435-445
    DOI: 10.3200/JECE.38.4.435-445
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.3200/JECE.38.4.435-445
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jeduce:v:38:y:2007:i:4:p:435-445. 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: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/VECE20 .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.