Railway Rates as Protective Tariffs

Income Taxes as Reciprocal Tariffs

Public finance experts have long explored the issue of income taxes making the cost of market transactions higher than nonmarket ones. A 50 percent income tax, for example, requires $20,000 in income to purchase $10,000 of market goods. The tax can be avoided, however, if the same goods can be produced at home. The upshot is that income taxes encourage the home production of goods and services ...

Tariffs versus Production Subsidies as Industry Protection

This paper provides a welfare comparison of a tariff with a combination of a production subsidy to, and a commodity tax on, an import-competing commodity in a two-country economy. We treat some plausible situations of industry protection, including where the initial tariff is above the optimal tariff, where a certain output level of a tariff-imposed commodity must be maintained, and where there...

Embodied Carbon Tariffs

Embodied carbon tariffs tax the direct and indirect carbon emissions embodied in trade — an idea popularized by countries seeking to extend the reach of domestic carbon regulations. We investigate their effectiveness using simulations from an applied general equilibrium model of global trade and energy use. We find that the tariffs do reduce foreign emissions, but their ability to improve the g...

Best Practice Tariffs

Comparison of Internet Service Tariffs

In this paper, we study the pricing of Internet services under monopoly and duopoly environments using a game-theoretic model in which a service provider and users all try to maximize their payoffs. First, we compare a few popular pricing schemes, including flat, volume-based, two-part and nonlinear tariffs with respect to revenue, social welfare and user surplus. We perform a sensitivity study...