Deakin University
Browse

File(s) under permanent embargo

Corrective taxes under oligopoly with inter-firm externalities

journal contribution
posted on 2003-10-01, 00:00 authored by Xiangkang YinXiangkang Yin
Pollution externalities between polluters should be taken into account in the design of corrective taxes. When the externalities are substantial and/or the number of polluters is large, the effluent levies on these firms do not necessarily result in a deadweight loss. Consequently, the second-best tax exceeds the marginal social cost of pollution. A more general rule is that the tax rate should be greater than the marginal social cost of pollution if and only if a marginal increase in the tax rate results in opposite effects on the changes of equilibrium emission level and output.

History

Journal

Environmental and resource economics

Volume

26

Issue

2

Pagination

269 - 277

Publisher

Springer

Location

New York, N.Y.

ISSN

0924-6460

Language

eng

Publication classification

C1.1 Refereed article in a scholarly journal

Copyright notice

2003, Kluwer Academic Publisher