Horizontal and vertical indirect tax competition: Theory and some evidence from the USA

• 成果类型: Article
• 署名作者: Devereux, M. P.; Lockwood, B.; Redoano, M.
• 署名单位: University of Warwick; Centre for Economic Policy Research - UK
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2006.07.005
• 发表日期: 2007
• 页码: 451-479
• 关键词: Tax competition; excise taxes; cross-border shopping; Smuggling

摘要

This paper provides a simple but general theoretical framework for analyzing simultaneous vertical and horizontal competition in excise taxes, which includes several previous contributions as special cases. It allows for both elastic individual demand for the taxed good, and cross-border shopping (and smuggling). It then estimates equations informed by the theory on a panel of US state and federal excise taxes on cigarettes and gasoline. The results are generally consistent with the theory, when the characteristics of the markets for the goods are taken into account. Taxes in neighboring states have a significant and large effect in the case of cigarettes. The possibility of smuggling cigarettes from low tax states also plays a role. In the case of gasoline, taxes in neighboring states do not play a significant role; however, there is evidence in this case of vertical competition. (c) 2006 Elsevier B.V. All rights reserved.