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Department of Business and Management Science, Norwegian School of Economics (NHH) Discussion Papers, Department of Business and Management Science, Norwegian School of Economics (NHH)

No 2008/1:
Efficiency Enhancing Taxation in Two-sided Markets

Hans Jarle Kind (), Marko Koethenbuerger () and Guttorm Schjelderup ()

Abstract: This paper examines the efficient provision of goods in two-sided markets and characterizes optimal specific and ad-valorem taxes. We show that (i) a monopoly may have too high output compared to the social optimum; (ii) output may be reduced by imposing negative value-added taxes (subsidy) or positive specific taxes.

Keywords: Market Structure and Pricing; Efficiency; Optimal Taxation; Incidence; (follow links to similar papers)

JEL-Codes: D40; D43; H21; H22; L13; (follow links to similar papers)

15 pages, January 25, 2008

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