Commodity Taxation

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August 31, 2024 4 min read Definitions

Inverse Elasticity Rule: Efficient Commodity Taxation

Economics Finance Inverse Elasticity Rule Commodity Taxation Economic Welfare Tax Policy Ramsey Rule

A rule describing efficient commodity taxation in a single consumer economy when there are no cross-price effects in demand, establishing that goods with low elasticities of demand should be taxed highly.

August 25, 2024 3 min read Definitions

Repressive Tax: Economic and Behavioral Discouragement

Economics Government Regulations Repressive Tax Sin Taxes High Tariffs Commodity Taxation Consumption Control

Repressive Tax is designed to discourage specific activities by imposing high tariffs and taxes on certain commodities, such as tobacco and alcohol. These taxes aim to reduce consumption rather than raise revenue.