A Simple Model of Commodity Taxation and Cross-Border Shopping

Søren Nielsen

No 98-18, EPRU Working Paper Series from Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics

Abstract: This paper sets up a simple model of commodity taxation and cross-border shopping. Two countries, differing in geographical extent, engage in tax competition originating in the opportunities for cross-border shopping. Both tax competition and various coordination initiatives are examined. Then follow two extensions: (i) inclusion of costs of transportation for goods; (ii) inclusion of border inspection. These extensions allow us to conclude that both a drop in transportation costs and abolishment of border control intensify commodity tax competition and lower tax rates and revenues. The qualitative results for coordination measures also hold for the extended versions of our model.

References: Add references at CitEc
Citations: View citations in EconPapers (2)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: A Simple Model of Commodity Taxation and Cross‐border Shopping (2001)
Working Paper: A simple model of commodity taxation and cross-border shopping (1998)
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:kud:epruwp:98-18

Access Statistics for this paper

More papers in EPRU Working Paper Series from Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics �ster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Hoffmann ().