Production efficiency and excess supply
This paper demonstrates that intermediate goods should not be taxed even in the presence of dividend payments to households, thus clarifying previous results. We also find that optimal government policy in a second best world may include stockpiles of output - private supply exceeds private demand, and the government purchases the surplus. This may provide a possible explanation for some agricultural policies.
|Date of creation:||01 Nov 2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +44 (0)191 334 5200
Fax: +44 (0)191 334 5201
Web page: http://www.dur.ac.uk/business
More information through EDIRC
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.:
- Berliant, Marcus & Page, Frank H, Jr, 2001. "Income Taxes and the Provision of Public Goods: Existence of an Optimum," Econometrica, Econometric Society, vol. 69(3), pages 771-84, May.
- Sadka, Efraim, 1977. "A Note on Producer Taxation and Public Production," Review of Economic Studies, Wiley Blackwell, vol. 44(2), pages 385-87, June.
- Besley, Timothy J. & Persson, Torsten, 2007.
"The Origins of State Capacity: Property Rights, Taxation, and Politics,"
CEPR Discussion Papers
6370, C.E.P.R. Discussion Papers.
- Timothy Besley & Torsten Persson, 2009. "The Origins of State Capacity: Property Rights, Taxation, and Politics," American Economic Review, American Economic Association, vol. 99(4), pages 1218-44, September.
- Timothy Besley & Torsten Persson, 2007. "The Origins of State Capacity: Property Rights, Taxation, and Politics," NBER Working Papers 13028, National Bureau of Economic Research, Inc.
- Timothy Besley & Torsten Persson, 2009. "The origins of state capacity: property rights, taxation and politics," LSE Research Online Documents on Economics 33768, London School of Economics and Political Science, LSE Library.
- repec:cup:cbooks:9780521629560 is not listed on IDEAS
- Sushama Murty, 2010. "Constraints on profit income distribution and production efficiency in private ownership economies with Ramsey taxation," Discussion Papers 1010, Exeter University, Department of Economics.
- Reinhorn, Leslie J., 2007. "Butter mountains and wine lakes," Economics Letters, Elsevier, vol. 94(2), pages 197-201, February.
- Weymark, John A, 1981. "On Sums of Production Set Frontiers," Review of Economic Studies, Wiley Blackwell, vol. 48(1), pages 179-83, January.
- Guesnerie, Roger, 1977.
"On the direction of tax reform,"
Journal of Public Economics,
Elsevier, vol. 7(2), pages 179-202, April.
- Hahn, Frank H., 1973. "On optimum taxation," Journal of Economic Theory, Elsevier, vol. 6(1), pages 96-106, February.
- Diewert, W E & Turunen-Red, A H & Woodland, A D, 1989. "Productivity- and Pareto-Improving Changes in Taxes and Tariffs," Review of Economic Studies, Wiley Blackwell, vol. 56(2), pages 199-215, April.
- Michael Keen & David Wildasin, 2004. "Pareto-Efficient International Taxation," American Economic Review, American Economic Association, vol. 94(1), pages 259-275, March.
- Mirrlees, James A, 1972. "On Producer Taxation," Review of Economic Studies, Wiley Blackwell, vol. 39(1), pages 105-11, January.
- Weymark, John A., 1979. "A reconciliation of recent results in optimal taxation theory," Journal of Public Economics, Elsevier, vol. 12(2), pages 171-189, October.
- Dixit, Avinash, 1987. "On Pareto-improving redistributions of aggregate economic gains," Journal of Economic Theory, Elsevier, vol. 41(1), pages 133-153, February.
- Dasgupta, Partha & Stiglitz, Joseph E, 1972. "On Optimal Taxation and Public Production," Review of Economic Studies, Wiley Blackwell, vol. 39(1), pages 87-103, January.
- Hammond, Peter J & Sempere, Jaime, 1995. "Limits to the Potential Gains from Economic Integration and Other Supply Side Policies," Economic Journal, Royal Economic Society, vol. 105(432), pages 1180-1204, September.
When requesting a correction, please mention this item's handle: RePEc:dur:durham:2011_13. 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: (IT Office)
If references are entirely missing, you can add them using this form.