Multi-part Tariffs and Differentiated Commodity Taxation

Anna D’Annunzio (), Mohammed Mardan and Antonio Russo
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Anna D’Annunzio: TBS Business School and CSEF
Authors registered in the RePEc Author Service: Anna D'Annunzio

CSEF Working Papers from Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy

Abstract: We study commodity taxation in markets where firms, such as Internet Service Providers, energy suppliers and payment card platforms, adopt multi-part tariffs. We show that ad valorem taxes can correct underprovision and hence increase welfare, provided the government applies differentiated tax rates to the usage and access parts of the tariff. We obtain this result in different settings, including vertically interlinked markets, markets where firms adopt menus of tariffs to screen consumers and where they compete with multi-part tariffs. Our results suggest that exempting these markets from taxation may be inefficient.

Keywords: Commodity taxation; multi-part tariffs; price discrimination (search for similar items in EconPapers)
JEL-codes: D42 D61 H21 (search for similar items in EconPapers)
Date: 2019-09-13
New Economics Papers: this item is included in nep-com, nep-pbe, nep-pub and nep-reg
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Forthcoming in RAND Journal of Economics

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http://www.csef.it/WP/wp540.pdf (application/pdf)

Related works:
Journal Article: Multi‐part tariffs and differentiated commodity taxation (2020)
Working Paper: Multi-Part Tariffs and Differentiated Commodity Taxation (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:sef:csefwp:540

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