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Unit versus ad valorem taxes: monopoly in general equilibrium

By Charles Blackorby and Sushama Murty


We show that if a monopoly sector is imbedded in a general equilibrium framework and profits are taxed at one hundred percent, then unit (specific) taxation and ad valorem taxation are welfare-wise equivalent. This is contrary to all known claims

Topics: HJ
Publisher: University of Warwick, Department of Economics
Year: 2006
OAI identifier:

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