Newspapers and advertising: The effects of ad-valorem taxation under duopoly.

Schjelderup, Guttorm; Stähler, Frank; Kind, Hans Jarle

Newspapers and advertising: The effects of ad-valorem taxation under duopoly.

Kind, Hans Jarle; Schjelderup, Guttorm; Stähler, Frank

Cite this item: Kind, H. J., Schjelderup, G., & Stähler, F. (2006). Newspapers and advertising: The effects of ad-valorem taxation under duopoly. (Economics Discussion Papers Series No. 609). University of Otago. Retrieved from http://hdl.handle.net/10523/903

Permanent link to OUR Archive version: http://hdl.handle.net/10523/903

Date: 2006-12

Publisher: University of Otago

Pages: 20

Series: Economics Discussion Papers Series

Series number: 609

Keywords: Two-sided markets; ad-valorem taxes

Research Type: Discussion Paper

Abstract:

Newspapers are two-sided platforms that sell their product both to readers and advertisers. Media firms in general, and newspapers in particular, are considered important providers of information, culture and language in most countries. Newspapers are therefore given preferential tax treatment.

We show that lower ad valorem taxes lead newspapers to become more differentiated.

Thereby the competitive pressure falls, possibly resulting in higher newspaper prices and reduced quality investments.

Show full item record