Template-Type: ReDIF-Paper 1.0
Author-Name: Simone Moriconi
Author-X-Name-First: Simone 
Author-X-Name-Last: Moriconi
Author-Email: simone.moriconi@unicatt.it
Author-Workplace-Name: Università Cattolica del Sacro Cuore
Author-Workplace-Name: Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore
Author-Name: Pierre M. Picard
Author-X-Name-First: Pierre M.  
Author-X-Name-Last: Picard
Author-Name: Skerdilajda Zanaj
Author-X-Name-First: Skerdilajda 
Author-X-Name-Last: Zanaj


Title: Commodity Taxation and Regulatory Competition
Abstract: TThis paper studies competition in commodity taxation and product market regula-
tion between trading partner countries. We present a two-country general equilibrium
model in which destination-based commodity taxes finance public goods, and prod-
uct market regulation affects both the number of firms in the market and product
diversity. We provide empirical evidence based on data for 21 OECD countries over
the 1990-2008 period. Our results suggest that commodity taxation and product mar-
ket regulation are interdependent policies. Theoretically and empirically we find an
absence of strategic interaction in commodity taxation between governments. Further-
more, we show that domestic regulation has a negative effect on domestic commodity
taxation. Finally, we demonstrate theoretically and show empirically that product
market regulation is a strategic complementary policy.
Length: 59
Creation-Date: 2015-11
File-URL: http://dipartimenti.unicatt.it/economia-finanza-def034.pdf
File-Format: Application/pdf
File-Function: First version, 2015
Number: def034
Classification-JEL: F0, H1, H7, H87, L5. 
Keywords: Regulation, commodity tax, strategic interactions.
Handle: RePEc:ctc:serie1:def034