The tax incidence is central to the effectiveness of taxation. In this paper, I examine the pass-through rate of an air passenger tax to airfares. Additionally, I analyse its impact on passenger numbers, air transport capacity, and the interaction with supply and demand elasticity. For...

In light of the UK Coalition Government's announced intention to reform APD (Air Passenger Duty), this article examines the design flaws making APD an inadequate environmental tax. By identifying the misconceived consequences and environmental inefficiencies of this blunt instrument, the need...

We exploit the abundance of tax changes in the airline industry after the DOT's full-disclosure rule. We determine the "effective" tax rate and analyze how passengers reacted to the tax changes. Hausman-type instruments are used to address the problems arising from endogenously determined...