Show simple item record

dc.contributor.author
Daubanes, Julien
dc.contributor.author
Lasserre, Pierre
dc.date.accessioned
2017-06-09T18:50:54Z
dc.date.available
2017-06-09T18:50:54Z
dc.date.issued
2012-02
dc.identifier.issn
1198-8177
dc.identifier.uri
http://hdl.handle.net/20.500.11850/45472
dc.description.abstract
Optimum commodity taxation theory asks how to raise a given amount of tax revenue while minimizing distortions. We reexamine Ramsey's inverse elasticity rule in presence of Hotelling-type non-renewable natural resources. Under standard assumptions borrowed from the non-renewable-resource-extraction and from the optimum-commodity-taxation literatures, a non-renewable resource should be taxed in priority whatever its demand elasticity and whatever the demand elasticity of regular commodities. It should also be taxed at a higher rate than other commodities having the same demand elasticity and, while the tax on regular commodities should be constant, the resource tax should vary over time. When the generation of reserves by exploration is determined by the net-of-tax rents derived during the extraction phase, reserves become a conventional form of capital and royalties tax its income; our results contradict Chamley's conclusion that capital should not be taxed at all in the very long run. When the economy is autarkic, in the absence of any subsidy to reserve discoveries, the optimal tax rate on extraction obeys an inverse elasticity rule almost identical to that of a commodity whose supply is perfectly elastic. As a matter of fact, there is a continuum of optimal combinations of reserve subsidies and extraction taxes, irrespective of whether taxes are applied on consumption or on production. When the government cannot commit, extraction rents are completely expropriated and subsidies are maximum. In general the optimum Ramsey tax not only causes a distortion of the extraction path, as happens when reserves are given, but also distorts the level of reserves developed for extraction. When that distortion is the sole effect of the tax, it is determined by a rule reminiscent of the inverse elasticity rule applying to elastically-supplied commodities. In an open economy, Ramsey taxes further acquire an optimum-tariff dimension, capturing foreign resource rents. For countries that import the resource, the result that domestic resource consumption is to be taxed at a higher rate than conventional commodities having the same demand elasticity emerges reinforced.
dc.language.iso
en
dc.publisher
Centre Interuniversitaire de Recherche en Analyse des Organisations CIRANO
dc.subject
Optimum commodity taxation
dc.subject
Inverse elasticity rule
dc.subject
Non-renewable resources
dc.subject
Hotelling resource
dc.subject
Supply elasticity
dc.subject
Demand elasticity
dc.subject
Capital income taxation
dc.title
Optimum Commodity Taxation with a Non-Renewable Resource
dc.type
Working Paper
ethz.journal.title
CIRANO série scientifique
ethz.journal.issue
2012s-04
ethz.publication.place
Montréal
ethz.publication.status
published
ethz.leitzahl
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03635 - Bretschger, Lucas / Bretschger, Lucas
ethz.leitzahl.certified
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03635 - Bretschger, Lucas / Bretschger, Lucas
ethz.date.deposited
2017-06-09T18:51:09Z
ethz.source
ECIT
ethz.identifier.importid
imp59364eeb9e46612952
ethz.ecitpid
pub:74720
ethz.eth
yes
ethz.availability
Metadata only
ethz.rosetta.installDate
2017-07-15T09:17:16Z
ethz.rosetta.lastUpdated
2018-10-01T15:48:33Z
ethz.rosetta.versionExported
true
ethz.COinS
ctx_ver=Z39.88-2004&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&rft.atitle=Optimum%20Commodity%20Taxation%20with%20a%20Non-Renewable%20Resource&rft.jtitle=CIRANO%20s%C3%A9rie%20scientifique&rft.date=2012-02&rft.issue=2012s-04&rft.issn=1198-8177&rft.au=Daubanes,%20Julien&Lasserre,%20Pierre&rft.genre=preprint&
 Search print copy at ETH Library

Files in this item

FilesSizeFormatOpen in viewer

There are no files associated with this item.

Publication type

Show simple item record