Optimal taxation of a monopolistic extractor: are subsidies necessary?

Julien Daubanes ()

No 08/92, CER-ETH Economics working paper series from CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich

Abstract: In a standard partial equilibrium model of resource depletion, this paper charac- terizes and examines the solution to the optimal taxation problem when extraction is monopolistic. The main result is that the family of subgame perfect effciency- inducing tax/subsidy schemes may include some strict tax policies. This illustrates how the static trade-off between inducing effciency and raising tax revenues in the presence of market power is relaxed under exhaustibility.

Keywords: Exhaustible resources; Imperfect competition; Optimal taxation (search for similar items in EconPapers)
JEL-codes: H21 L12 Q30 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2008-07
New Economics Papers: this item is included in nep-env, nep-mic and nep-pbe
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Related works:
Journal Article: Optimal taxation of a monopolistic extractor: Are subsidies necessary? (2011)
Working Paper: On the Optimal Taxation of an Exhaustible Resource under Monopolistic Extraction (2007)
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