We revisit the fundamental issue of market provision of variety associated with Chamberlin, Spence, and Dixit-Stiglitz when firms sell multiple products. Both products and firms are (horizontally) differentiated. We propose a general nested demand framework where consumers first decide upon a...

The relative efficiency of ad valorem and unit taxes is analyzed for oligopolistic markets. We provide a simple proof that ad valorem taxes welfare-dominate unit taxes in the short run if production costs are identical across firms. The proof covers a wide range of market conduct and...

The relative efficiency of ad valorem and unit taxes is analyzed for oligopolistic markets. We provide a simple proof that ad valorem taxes welfare-dominate unit taxes in the short run if production costs are identical across firms. The proof covers a wide range of market conduct and...