Plott, Charles R. (1966) Externalities and Corrective Taxes. Economica, 33 (129). pp. 84-87. ISSN 0013-0427. https://resolver.caltech.edu/CaltechAUTHORS:20140220-100216781
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Abstract
Consider a factory which produces some unspecified product called X. The process of producing X involves the creation of an external diseconomy for a nearby business. It is generally recognized that this diseconomy may be the result of some resource used in the production of X such as smoke created from a burning process. However, the participants in the recent discussion of externalities, as well as Pigou, have assumed either by means of their examples, or explicitly, that in such cases the corrective tax should be placed on the production of X. This procedure, except under rather restrictive conditions, is fundamentally incorrect. If a corrective tax exists, it must be placed either on the smoke output or, under certain conditions, on the resource input from which the smoke is generated.
Item Type: | Article | ||||||
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Additional Information: | © 1966 Published by Wiley on behalf of The London School of Economics and Political Science and The Suntory and Toyota International Centres for Economics and Related Disciplines. | ||||||
Issue or Number: | 129 | ||||||
Record Number: | CaltechAUTHORS:20140220-100216781 | ||||||
Persistent URL: | https://resolver.caltech.edu/CaltechAUTHORS:20140220-100216781 | ||||||
Official Citation: | Externalities and Corrective Taxes Charles R. Plott Economica , New Series, Vol. 33, No. 129 (Feb., 1966) , pp. 84-87 Published by: Wiley on behalf of The London School of Economics and Political Science and The Suntory and Toyota International Centres for Economics and Related Disciplines Article Stable URL: http://www.jstor.org/stable/2552274 | ||||||
Usage Policy: | No commercial reproduction, distribution, display or performance rights in this work are provided. | ||||||
ID Code: | 43886 | ||||||
Collection: | CaltechAUTHORS | ||||||
Deposited By: | INVALID USER | ||||||
Deposited On: | 20 Feb 2014 18:19 | ||||||
Last Modified: | 28 Sep 2022 22:08 |
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