Specific and Ad Valorem Taxation in Asymmetric Cournot Oligopolies

Vincenzo Denicolo' () and Massimo Matteuzzi

International Tax and Public Finance, 2000, vol. 7, issue 3, 335-342

Abstract: This paper compares ad valorem and specific taxes in asymmetric homogenous Cournot oligopolies with constant marginal costs. We show that for any given level of industry output, ad valorem taxes are superior to specific taxes in terms of revenue raised. If the tax rates are sufficiently high, for any given specific tax one can find an ad valorem tax that leads to greater tax revenue, consumer surplus, and industry profits. Copyright Kluwer Academic Publishers 2000

Keywords: specific tax; ad valorem tax; cournot oligopoly; welfare dominance (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (34)

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DOI: 10.1023/A:1008709914537

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