Pareto improving taxes

Geanakoplos, John; Polemarchakis, Herakles

doi:10.1016/j.jmateco.2007.07.007

Cited by 24 publications

(7 citation statements)

References 31 publications

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“…However, such tax-transfer schemes may raise deficits. Geanakoplos and Polemarchakis (2008) [GP] show that in (almost all) pure exchange economies with separable externalities, a tax-transfer scheme can be used to Pareto improve upon competitive equilibria. Although we study the role of taxes in the context of technology transfer rather than externalities, our paper shares the broad theme that taxes can be used to improve market outcomes.…”

Section: Introductionmentioning

confidence: 99%

Decreasing Returns, Patent Licensing and Price-Reducing Taxes

Sen

Stamatopoulos

2013

SSRN Journal

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Patent licensing agreements among competing firms usually involve royalties which are often considered to be anticompetitive as they raise market prices. In this paper we propose simple tax policies than can alleviate the effect of royalties. Considering a Cournot duopoly where firms produce under decreasing returns and trade a patented technology, we show that the interaction of royalties with decreasing returns may generate the counter-intuitive result that market prices decrease in the magnitude of diseconomies of scale. In such cases there exist progressive quantity taxes on firms that weaken the effect of royalties and lower the market prices. These taxes collect sufficient revenue to compensate firms for their losses. As a result, it is possible to design deficit neutral tax-transfer schemes that strictly Pareto improve the welfare of consumers as well as firms.

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Section: Introductionmentioning

confidence: 99%

Decreasing Returns, Patent Licensing and Price-Reducing Taxes

Sen

Stamatopoulos

2013

SSRN Journal

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“…In recent work, Geanakoplos and Polemarchakis (2008) showed that the taxation of exchanges implements Pareto improvements in abstract economies with externalities, while Citanna, Polemarchakis and Tirelli (2006) obtained an analogous result for economies with an incomplete asset market.…”

Section: E¢ Ciencymentioning

confidence: 97%

Markets and contracts

Bisin

Geanakoplos²,

Gottardi

et al. 2011

Journal of Mathematical Economics

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“…Despite general familiarity with Pigouvian taxation, policy makers have not embraced the concept of "good taxes". As emphasized by Geanakoplos & Polemarchakis (2008), there are at least three reasons.…”

Section: Pigouvian Taxes Often Helpmentioning

confidence: 99%

In Search of an Alternative to Shareholder Value Maximization

Giraud

Renouard

2011

SSRN Journal

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Abstract.-This paper argues that mainstream economic theory, far from providing an indisputable plea in favor of shareholder value-maximization, offers striking arguments showing quite the opposite: profit-maximization cannot be a legitimate prioritarian goal for private firms. This opens the door for a widening of a company's goal. We argue that it should include the concern of all the stakeholders of a company, and cannot be adequately addressed uniquely by Pigouvian taxes or by property rights. Coming to terms with this broad understanding of a company's goal should imply the internalization of the stakeholders' concern within the legal structure of the firm -as in the case of the scic in France or the cic in the UK.

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Pareto improving taxes

Cited by 24 publications

References 31 publications

Decreasing Returns, Patent Licensing and Price-Reducing Taxes

Decreasing Returns, Patent Licensing and Price-Reducing Taxes

Markets and contracts

In Search of an Alternative to Shareholder Value Maximization

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