Unit Versus Ad Valorem Taxes : The Private Ownership of Monopoly In General Equilibrium
In an earlier paper [Blackorby and Murty; 2007] we showed that if a monopoly sector is imbedded in a general equilibrium framework and profits are taxed at one hundred percent, then unit (specific) taxation and ad valorem taxation are welfare-wise equivalent. In this paper, we consider private ownership of the monopoly sector. Given technical difficulties in making a direct general equilibrium comparison of unit and ad valorem taxation, we adopt a technique due to Guesnerie  and Quinzii  in a somewhat different context of increasing returns and non-convex economies to show that neither ad valorem taxation nor unit taxation Pareto dominates the other; although, generally, the two are not welfare-wise equivalent.
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- Delipalla, Sofia & Keen, Michael, 1992.
"The comparison between ad valorem and specific taxation under imperfect competition,"
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- Charles Blackorby & Sushama Murty, 2013.
"Unit Versus Ad Valorem Taxes: The Private Ownership of Monopoly in General Equilibrium,"
Journal of Public Economic Theory,
Association for Public Economic Theory, vol. 15(4), pages 547-579, August.
- Blackorby, Charles & Murty, Sushama, 2007. "Unit Versus Ad Valorem Taxes : The Private Ownership of Monopoly In General Equilibrium," The Warwick Economics Research Paper Series (TWERPS) 797, University of Warwick, Department of Economics.
- Charles Blackorby & Sushama Murty, 2010. "Unit Versus Ad Valorem Taxes: The Private Ownership of Monopoly In General Equilibrium," Discussion Papers 1011, Exeter University, Department of Economics.
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Elsevier, vol. 91(3-4), pages 817-822, April.
- Blackorby, Charles & Murty, Sushama, 2006. "Unit Versus Ad Valorem Taxes : Monopoly In General Equilibrium," The Warwick Economics Research Paper Series (TWERPS) 761, University of Warwick, Department of Economics.
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