Coady, David and Dreze, Jean (2000) Commodity taxation and social welfare: the generalised Ramsey rule. DEDPS (27). Suntory and Toyota International Centres for Economics and Related Disciplines, London, UK.
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Abstract
Commodity taxes have three distinct roles: (1) revenue collection, (2) interpersonal redistribution, and (3) resource allocation. The paper presents an integrated treatment of these three concerns in a second-best general equilibrium framework, which leads to the 'generalised Ramsey rule' for optimum taxation. We show how many standard results on optimum taxation and tax reform have a straightforward counterpart in this general framework. Using this framework, we also try to clarify the notion of 'deadweight loss' as well as the relation between alternative distributional assumptions and the structure of optimum taxes.
| Item Type: | Monograph (Discussion Paper) |
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| Official URL: | http://sticerd.lse.ac.uk |
| Additional Information: | © 2000 David Coady and Jean Dreze |
| Divisions: | STICERD |
| Subjects: | H Social Sciences > HV Social pathology. Social and public welfare. Criminology H Social Sciences > HJ Public Finance |
| JEL classification: | H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H23 - Externalities; Redistributive Effects; Environmental Taxes and Subsidies H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H21 - Efficiency; Optimal Taxation |
| Date Deposited: | 08 Jul 2008 08:40 |
| Last Modified: | 15 Sep 2023 22:48 |
| URI: | http://eprints.lse.ac.uk/id/eprint/6651 |
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