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On Market Structure and the Taxation of Exhaustible Resources:
Author(s) -
Dore M. H. I.
Publication year - 1990
Publication title -
american journal of economics and sociology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.199
H-Index - 38
eISSN - 1536-7150
pISSN - 0002-9246
DOI - 10.1111/j.1536-7150.1990.tb02472.x
Subject(s) - economic rent , economics , oligopoly , market structure , microeconomics , competition (biology) , work (physics) , cournot competition , mechanical engineering , ecology , engineering , biology
A bstract . The older static theory of the taxation of exhaustible resources is distinguished from the modern theory based on the work of Harold Hotelling Both advocate some form of a profits‐based tax , which is appropriate for conditions of perfect competition. But an oligopolistic market structure has additional quasi‐rents which could be captured through taxation. It is argued that a sales tax will not only capture the rents but also lower the cut‐off grade of the ore mined.