Profit Taxation and Capital Accumulation in Dynamic Oligopoly Models.

Lambertini, Luca ; Baldini, Massimo (2002) Profit Taxation and Capital Accumulation in Dynamic Oligopoly Models. Bologna: Dipartimento di Scienze economiche DSE, p. 18. DOI 10.6092/unibo/amsacta/4863. In: Quaderni - Working Paper DSE (435). ISSN 2282-6483.
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Abstract

We illustrate two differential oligopoly games using, respectively, the capital accumulation dynamics `a la Solow-Nerlove-Arrow, and the capital accumulation dynamics `a la Ramsey. In both settings, we evaluate the effects of (gross) profit taxation, proving that there exist tax rates yielding the same steady state social welfare as under social planning. Contrary to the static approach, our dynamic analysis shows that, in general, profit taxation affects firms’ decisions concerning capital accumulation and sales. In particular, it has pro-competitive effects provided that the extent of delegation is large enough.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Lambertini, Luca
Baldini, Massimo
Keywords
differential games, capital accumulation, open-loop equilibria, closed-loop equilibria, profit taxation
Subjects
ISSN
2282-6483
DOI
Deposit date
17 Mar 2016 13:49
Last modified
17 Mar 2016 13:49
URI

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