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The Non-Neutrality Of Wto Border Tax Adjustments For Environmental Excise Taxes Under Imperfect Competition

Author

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  • McCorriston, Steve
  • Sheldon, Ian M.

Abstract

Border tax adjustments for environmental taxes should leave imports of final goods unchanged. If intermediate and final goods markets are imperfectly competitive though, non-neutrality can result. Under Cournot behavior, an import tax equal to the environmental tax is too high, and under Bertrand, an import subsidy is the appropriate policy.

Suggested Citation

  • McCorriston, Steve & Sheldon, Ian M., 2002. "The Non-Neutrality Of Wto Border Tax Adjustments For Environmental Excise Taxes Under Imperfect Competition," 2002 Annual meeting, July 28-31, Long Beach, CA 19673, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea02:19673
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    File URL: http://purl.umn.edu/19673
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    References listed on IDEAS

    as
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    6. James Poterba & Julio Rotemberg, 1995. "Environmental taxes on intermediate and final goods when both can be imported," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 2(2), pages 221-228, August.
    7. Kyle Bagwell & Robert W. Staiger, 2001. "The WTO as a Mechanism for Securing Market Access Property Rights: Implications for Global Labor and Environmental Issues," Journal of Economic Perspectives, American Economic Association, vol. 15(3), pages 69-88, Summer.
    8. Conrad Klaus, 1993. "Taxes and Subsidies for Pollution-Intensive Industries as Trade Policy," Journal of Environmental Economics and Management, Elsevier, vol. 25(2), pages 121-135, September.
    9. Thomas A. Barthold, 1994. "Issues in the Design of Environmental Excise Taxes," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 133-151, Winter.
    10. Stern, Nicholas, 1987. "The effects of taxation, price control and government contracts in oligopoly and monopolistic competition," Journal of Public Economics, Elsevier, vol. 32(2), pages 133-158, March.
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