International Resource Tax Policies Beyond Rent Extraction

Lucas Bretschger and Simone Valente

No 13/185, CER-ETH Economics working paper series from CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich

Abstract: We study the incentives of selfish governments to tax tradable primary inputs un- der asymmetric trade. Using an empirically-consistent model of endogenous growth, we obtain explicit links between persistent gaps in productivity growth and the observed tendency of resource-exporting (importing) countries to subsidize (tax) domestic resource use. Assuming uncoordinated maximization of domestic welfare, national governments wish to deviate (i) from inefficient laissez-faire equilibria as well as (ii) from efficient equilibria in which domestic distortions are internalized. The incentive of resource-rich countries to subsidize hinges on slower productivity growth and is disconnected from the typical incentive of importers to tax resource inflows. i.e., rent extraction. The model predictions concerning the impact of resource taxes on relative income shares are supported by empirical evidence.

Keywords: Productivity Growth; Exhaustible Resources; International Trade. (search for similar items in EconPapers)
JEL-codes: F43 O40 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2013-11
New Economics Papers: this item is included in nep-eff, nep-env, nep-fdg and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.cer.ethz.ch/content/dam/ethz/special-in ... papers/WP-13-185.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not found UA (http://www.cer.ethz.ch/content/dam/ethz/special-interest/mtec/cer-eth/cer-eth-dam/documents/working-papers/WP-13-185.pdf [301 Moved Permanently]--> https://www.cer.ethz.ch/content/dam/ethz/special-interest/mtec/cer-eth/cer-eth-dam/documents/working-papers/WP-13-185.pdf [301 Moved Permanently]--> https://cer.ethz.ch/content/dam/ethz/special-interest/mtec/cer-eth/cer-eth-dam/documents/working-papers/WP-13-185.pdf)

Related works:
Working Paper: International Resource Tax Policies Beyond Rent Extraction (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eth:wpswif:13-185

Access Statistics for this paper

More papers in CER-ETH Economics working paper series from CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich Contact information at EDIRC.
Bibliographic data for series maintained by ().