Book contents
- Frontmatter
- Contents
- PREFACE
- ACKNOWLEDGEMENTS
- INTRODUCTION AND SUMMARY OF STUDY
- PART I The General Equilibrium Model of the UK – Structure, Data and Model Solution.
- PART II Empirical Analysis of the UK Tax/Subsidy System Using the General Equilibrium Model
- SUMMARY AND CONCLUSIONS
- APPENDIX A Structure of the Basic Variant Model
- APPENDIX B Notes to Tables Appearing in Chapter 5
- APPENDIX C Notes on Programming and Computation
- BIBLIOGRAPHY
INTRODUCTION AND SUMMARY OF STUDY
Published online by Cambridge University Press: 04 August 2010
- Frontmatter
- Contents
- PREFACE
- ACKNOWLEDGEMENTS
- INTRODUCTION AND SUMMARY OF STUDY
- PART I The General Equilibrium Model of the UK – Structure, Data and Model Solution.
- PART II Empirical Analysis of the UK Tax/Subsidy System Using the General Equilibrium Model
- SUMMARY AND CONCLUSIONS
- APPENDIX A Structure of the Basic Variant Model
- APPENDIX B Notes to Tables Appearing in Chapter 5
- APPENDIX C Notes on Programming and Computation
- BIBLIOGRAPHY
Summary
Introduction
In the UK, as in other countries, there has been substantial discussion in recent years of tax reform. Many of the problems and difficulties encountered by the UK economy have, at times, been attributed to the structure of the tax system, and over the years both politicians and academic economists have produced a number of alternative proposals for tax reform. The Report of the Royal Commission on Taxation (1966), and more recently the Meade Report (1978), are evidence of this continuing interest. In spite of pressure for change, however, quantitative analysis of the effects which taxes and subsidies produce (especially those on resource allocation) remains surprisingly sparse, both in the UK and elsewhere.
In this study we use a conceptual approach, widely explored in theoretical literature in public finance, to analyze the impacts of the UK tax/subsidy system on the allocation of resources and the distribution of income using 1973 data. We explore general equilibrium efficiency and incidence effects of taxes and subsidies, emphasizing a numerical, empirically oriented version of this well-known approach. In Part I of the study we describe the structure of the model we use. Part II reports our empirical results.
The approach used is to build a general equilibrium model using explicit demand and production functions. In the model all markets clear in equilibrium. Demands equal supplies for both goods and factors, and no industry does any better than break even in terms of profitability.
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- Publisher: Cambridge University PressPrint publication year: 1985