Electronic Resource
PO Box 378, Carlton South Victoria 3053, Australia
:
Blackwell Publishing Asia Pty Ltd
Pacific economic review
9 (2004), S. 0
ISSN:
1468-0106
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
Abstract. The ‘diamond effect’ exists when a consumer's utility depends on the exchange value, not just on the intrinsic consumption effects of the good. Yew-Kwang Ng has discussed the optimal tax on a pure ‘diamond’ good. This paper extends Ng's model to cover mixed diamond goods. It uses three mathematical models to show that the optimal tax on a mixed diamond good with both intrinsic and diamond effects depends on the proportion of the diamond effect. The result may explain the violation of the Ramsey Rule in practice, and may be used to formulate private car taxes in China.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/j.1468-0106.2004.00250.x
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