One Markup to Rule Them AM: Taxation by Liquor Pricing Regulation

• 成果类型: Article
• 署名作者: Miravete, Eugenio J.; Seim, Katja; Thurk, Jeff
• 署名单位: University of Texas System; University of Texas Austin; Center for Economic & Policy Research (CEPR); Yale University; National Bureau of Economic Research; University of Notre Dame
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20180155
• 发表日期: 2020
• 页码: 1-41
• 关键词: excessive alcohol-consumption; public production; COSTS; externalities; elasticities; demand; prices; POWER; US

摘要

Commodity taxation often involves uniform tax rates. We use alcohol laws that tax differentiated spirits with a comprehensive uniform markup to evaluate redistribution generated by such simple tax policy. We document preference heterogeneity among consumers, variation in product demand elasticities, and market power among producers with heterogeneous product portfolios. Relative to more flexible product-level markups recognizing demand heterogeneity and strategic price responses of firms, we find that the uniform markup underprices less elastic spirits, implicitly subsidizing low-income and less educated residents. The uniform markup grants additional market power to small specialized firms whose product positioning benefits from the policy.