Document Type


Publication Date

March 2015

Publication Title

Economics and Business Letters



Issue Number


First Page


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This paper examines the output effect of an ad-valorem tax of undifferentiated oligopolistic firms in the Weber-Moses triangle. It shows that an increase in the ad-valorem tax will increase each firm’s output but may increase the number of firms and total output of firms if the inverse demand function is linear, concave or not too convex. This result is different from the well-known Tanaka’s result in non-spatial economy. It indicates that oligopolistic firm’s location decision has important influence on the output effect of the ad-valorem tax.


©2015 Oviedo University Press. This article was published in Economics and Business Letters, volume 4, issue 1, 2015. It is also available at this link.
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This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.