| Author: | Borger, B. de |
| Title: | Optimal two-part tariffs in a model of discrete choice |
| Journal: | Journal of Public Economics
2000 : APR, VOL. 76:1, p. 127-150 |
| Index terms: | CHOICE THEORY TAXATION TARIFFS |
| Language: | eng |
| Abstract: | In this paper the author studies welfare-optimal two-part tariffs in a model of discrete choice. The determinants of the sign and magnitude of the fixed and variable tax are analysed in terms of the nature and degree of consumer heterogeneity, the price sensitivities of participation probabilities and conditional demands, and the nature of distributional concerns, the model generalizes the "corrected" Ramsey rule for the variable tax and it shows that, in the absence of collection or fixed participation costs, the fixed fee may be negative. |
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