On the Generalised Anti-inverse Elasticity Rule: An Existence Result

Junichi Minagawa and Thorsten Upmann

No 7041, CESifo Working Paper Series from CESifo

Abstract: We consider an optimal commodity taxation problem under a consumption target and prove the existence of an optimal solution for the problem. This optimal solution obeys taxation rules that are contrary to standard taxation rules such as the inverse-elasticity rule. We also verify the necessary and sufficient condition for the optimal solution to exhibit uniform pricing.

Keywords: anti-inverse elasticity rule; consumption target; existence of an optimal solution; optimal commodity taxation; uniform pricing (search for similar items in EconPapers)
JEL-codes: H21 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-pub
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