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Advertising Has Got You On The Run. Well-Being, Consumption and Leisure in a GE model

  • Fabio FIORILLO

    ()

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

  • Marco LILLA

    ()

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

  • Stefano STAFFOLANI

    ()

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

This paper presents a general equilibrium model where rms producing the consumption good in an oligopolistic market purchase advertising in order to increase their market shares. The model aims to evaluate the general equilibrium consequences of such a behaviour. It analyses the e ects of a taxation of advertising on demand for the nal good, on working time and on individual well-being. We conclude that, unless the direct e ects of advertising on utility are strong, a positive tax rate on advertising raises leisure, reduces consumption and increases well-being.

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File URL: http://docs.dises.univpm.it/web/quaderni/pdf/389.pdf
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Paper provided by Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali in its series Working Papers with number 389.

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Length: 16
Date of creation: Feb 2013
Date of revision:
Handle: RePEc:anc:wpaper:389
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  1. Nelson, Philip, 1974. "Advertising as Information," Journal of Political Economy, University of Chicago Press, vol. 82(4), pages 729-54, July/Aug..
  2. GARY-BOBO, Robert J. & MICHEL, Philippe, . "Informative advertising and competition: a noncooperative approach," CORE Discussion Papers RP -940, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  3. Keith Cowling & Rattanasuda Poolsombat & Philip Tomlinson, 2011. "Advertising and labour supply: why do Americans work such long hours?," International Review of Applied Economics, Taylor & Francis Journals, vol. 25(3), pages 283-301.
  4. Luigi Marattin, 2008. "The Impact Of Advertising On Aggregate Consumption: The Case Of Italy," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 3(3(5)_Fall), pages 223-231.
  5. Robert B. Ekelund & Franklin G. Mixon & Rand W. Ressler, 1995. "Advertising and information: an empirical study of search, experience and credence goods," Journal of Economic Studies, Emerald Group Publishing, vol. 22(2), pages 33-43, May.
  6. Pintea, Mihaela I., 2010. "Leisure externalities: Implications for growth and welfare," Journal of Macroeconomics, Elsevier, vol. 32(4), pages 1025-1040, December.
  7. Lonnie Golden, 2009. "A Brief History of Long Work Time and the Contemporary Sources of Overwork," Journal of Business Ethics, Springer, vol. 84(2), pages 217-227, January.
  8. Bill Dupor & Wen-Fang Liu, 2003. "Jealousy and Equilibrium Overconsumption," American Economic Review, American Economic Association, vol. 93(1), pages 423-428, March.
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