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6. [Exercise 7.2.1 in McAfee, Lewis and Dale*] What is the relationship between the tax revenue from a Pigouvian tax and the damage produced by
6. [Exercise 7.2.1 in McAfee, Lewis and Dale*] What is the relationship between the tax revenue from a Pigouvian tax and the damage produced by the negative externality? Is the tax revenue sufficient to pay those damaged by the external effect an amount equal to their damage? You can assume that the marginal external effect is either increasing or decreasing
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
