IDEAS home Printed from https://ideas.repec.org/p/lmu/muenar/20424.html
   My bibliography  Save this paper

International oligopoly and the taxation of commerce with revenue-constrained governments

Author

Listed:
  • Haufler, Andreas
  • Pflüger, Michael

Abstract

We evaluate the incentives for strategic commodity tax-setting under destination and origin regimes when competition is imperfect and commodity taxes must be used to finance the government budget. Different cases of international duopoly are compared, where firms compete over quantities or prices and markets are segmented or integrated. In each setting the international spillovers of tax policy are isolated and evaluated at the Pareto-efficient tax rate. We find that origin-based commodity taxation leads to a downward competition of tax rates in each of the models analysed, whereas no similarly broad-based incentives for beggar-thy-neighbour policies exist under the destination principle.

Suggested Citation

  • Haufler, Andreas & Pflüger, Michael, 2007. "International oligopoly and the taxation of commerce with revenue-constrained governments," Munich Reprints in Economics 20424, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:20424
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Haufler, Andreas & Pflüger, Michael, 2003. "Market structure and the taxation of international trade," Discussion Papers in Economics 106, University of Munich, Department of Economics.
    2. Jagdish Bhagwati & Arvind Panagariya & T. N. Srinivasan, 1998. "Lectures on International Trade, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262522470, December.
    3. Jacques-Bernard Sauner-Leroy, 2003. "The impact of the implementation of the Single Market Programme on productive efficiency and on mark-ups in the European Union manufacturing industry," European Economy - Economic Papers 2008 - 2015 192, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    4. Thisse, Jacques-François & Hamilton, Jonathan & Ottaviano, Gianmarco & Behrens, Kristian, 2004. "Destination- versus Origin-based Commodity Taxation and the Location of Industry," CEPR Discussion Papers 4671, C.E.P.R. Discussion Papers.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ourania Karakosta, 2018. "Tax Competition in Vertically Differentiated Markets with Environmentally Conscious Consumers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 69(4), pages 693-711, April.
    2. Braun, Sebastian & Spielmann, Christian, 2012. "Wage subsidies and international trade: When does policy coordination pay?," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-42.
    3. Ourania Karakosta & Nikos Tsakiris, 2014. "Can tariff and tax reforms deliver welfare improvements under imperfect competition?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 23(3), pages 315-328, April.
    4. Oliver Krebs & Michael Pflüger, 2018. "How deep is your love? A quantitative spatial analysis of the transatlantic trade partnership," Review of International Economics, Wiley Blackwell, vol. 26(1), pages 171-222, February.
    5. Simone Moriconi & Pierre M. Picard & Skerdilajda Zanaj, 2019. "Commodity taxation and regulatory competition," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(4), pages 919-965, August.
    6. Gugl, Elisabeth & Zodrow, George R., 2019. "Tax Competition and the Efficiency of “Benefit-Related†Business Taxes," Working Papers 19-006, Rice University, Department of Economics.
    7. Raimondos-Møller, Pascalis & Schmitt, Nicolas, 2010. "Commodity taxation and parallel imports," Journal of Public Economics, Elsevier, vol. 94(1-2), pages 153-162, February.
    8. Moriconi, Simone & Sato, Yasuhiro, 2009. "International commodity taxation in the presence of unemployment," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 939-949, August.
    9. Fabio Antoniou & Panos Hatzipanayotou & Nikos Tsakiris, 2015. "Destination vs. Origin-based Commodity Taxation in Large Open Economies with Unemployment," CESifo Working Paper Series 5585, CESifo.
    10. Behrens, Kristian & Hamilton, Jonathan H. & Ottaviano, Gianmarco I.P. & Thisse, Jacques-François, 2009. "Commodity tax competition and industry location under the destination and the origin principle," Regional Science and Urban Economics, Elsevier, vol. 39(4), pages 422-433, July.
    11. Elisabeth Gugl & George R. Zodrow, 2019. "Tax competition and the efficiency of “benefit-related” business taxes," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(3), pages 486-505, June.
    12. Fabio Antoniou & Panos Hatzipanayotou & Michael S. Michael & Nikos Tsakiris, 2022. "Tax competition in the presence of environmental spillovers," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 29(3), pages 600-626, June.
    13. Fabio Antoniou & Panos Hatzipanayotou & Nikos Tsakiris, 2019. "Destination‐based vs. Origin‐based Commodity Taxation in Large Open Economies with Unemployment," Economica, London School of Economics and Political Science, vol. 86(341), pages 67-86, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Moriconi, Simone & Sato, Yasuhiro, 2009. "International commodity taxation in the presence of unemployment," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 939-949, August.
    2. James Lake & Maia Linask, 2015. "Costly distribution and the non-equivalence of tariffs and quotas," Public Choice, Springer, vol. 165(3), pages 211-238, December.
    3. Boggio, Luciano, 2009. "Long-run effects of low-wage countries' growing competitiveness and exports of manufactures," Structural Change and Economic Dynamics, Elsevier, vol. 20(1), pages 38-49, March.
    4. Harald Badinger & Fritz Breuss, 2004. "Has Austria's Accession to the EU Triggered an Increase in Competition? A Sectoral Markup Study," WIFO Working Papers 220, WIFO.
    5. Haufler, Andreas & Pflüger, Michael, 2003. "Market structure and the taxation of international trade," Discussion Papers in Economics 106, University of Munich, Department of Economics.
    6. P. Sai-wing Ho, 2004. "Myrdal’s Backwash and Spread Effects in Classical Economics: Implications for Multilateral Trade Negotiations," Journal of Economic Issues, Taylor & Francis Journals, vol. 38(2), pages 537-544, June.
    7. Anwar, Sajid, 2005. "Specialisation-based external economies, supply of primary factors and government size," Journal of Economics and Business, Elsevier, vol. 57(3), pages 259-271.
    8. G. Corcos & M. Del Gatto & G. Mion & GIP. Ottaviano, 2007. "Productivity and Firm Selection: Intra- vs International Trade," Working Paper CRENoS 200706, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    9. Howell H. Zee, 2007. "Export taxes in times of trade surpluses," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 16(2), pages 137-157.
    10. Fernando MESA PARRA, 2001. "Strategic Trade Policy and Exchange Rate Uncertainty," Archivos de Economía 3527, Departamento Nacional de Planeación.
    11. Xin Zhao & Gregmar I. Galinato & Tim A. Graciano, 2019. "The Welfare Effects of Opening to Foreign Direct Investment in Polluting Sectors," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(1), pages 243-269, September.
    12. repec:lan:wpaper:3064 is not listed on IDEAS
    13. Yasuyuki Sawada, 2009. "The immiserizing growth: an empirical evaluation," Applied Economics, Taylor & Francis Journals, vol. 41(13), pages 1613-1620.
    14. Conconi, P., 2000. "Trade Bloc Formation Under Imperfect Competition," The Warwick Economics Research Paper Series (TWERPS) 571, University of Warwick, Department of Economics.
    15. David Greenaway & Douglas Nelson, 2010. "The Politics of (Anti-)Globalization: What do we Learn from Simple Models?," Chapters, in: Noel Gaston & Ahmed M. Khalid (ed.), Globalization and Economic Integration, chapter 4, Edward Elgar Publishing.
    16. Robinson, Sherman & Thierfelder, Karen, 2019. "Global adjustment to US disengagement from the world trading system," Journal of Policy Modeling, Elsevier, vol. 41(3), pages 522-536.
    17. Ian Sheldon, 2006. "Trade and Environmental Policy: A Race to the Bottom?," Journal of Agricultural Economics, Wiley Blackwell, vol. 57(3), pages 365-392, September.
    18. Beladi, Hamid & Chao, Chi-Chur & Hazari, Bharat R. & Laffargue, Jean-Pierre, 2009. "Tourism and the environment," Resource and Energy Economics, Elsevier, vol. 31(1), pages 39-49, January.
    19. López, Ramón & Schiff, Maurice, 2013. "Interactive dynamics between natural and man-made assets: The impact of external shocks," Journal of Development Economics, Elsevier, vol. 104(C), pages 1-15.
    20. Praveen Kujal & Juan M. Ruiz, 2009. "International Trade Policy towards Monopoly and Oligopoly," Review of International Economics, Wiley Blackwell, vol. 17(3), pages 461-475, August.
    21. Thomas H.W. Ziesemer, 2014. "Country terms of trade: trends, unit roots, over-differencing, endogeneity, time dummies, and heterogeneity," International Review of Applied Economics, Taylor & Francis Journals, vol. 28(6), pages 767-796, September.

    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:lmu:muenar:20424. See general information about how to correct material in RePEc.

    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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tamilla Benkelberg (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.