| Abstract: | If the inverse demand function in the domestic country is concave, or it is not too convex even if it is convex, a small specific commodity tax raises the social welfare in the domestic country and lowers the welfare of the foreign consumers, and the optim- al tax for the domestic country is positive. The presence of an export market enlarges the possibility that a specific commodity tax raises the social welfare in the domestic country at the sacrifice of the welfare of the foreign consumers. L13] |
