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| Initial rate
of export tax (percent) |
Initial trade deficit as a share of GDP (percent) |
|||||
| 0 | 5 | 10 | 15 | 20 | 25 | |
| 5.0 | 54.98 | 15.00 | 8.27 | 5.47 | 3.91 | 2.90 |
| 10.0 | 42.67 | 13.67 | 7.74 | 5.15 | 3.69 | 2.73 |
| 15.0 | 34.52 | 12.49 | 7.23 | 4.85 | 3.47 | 2.56 |
| 20.0 | 28.71 | 11.42 | 6.74 | 4.54 | 3.25 | 2.38 |
| 25.0 | 24.35 | 10.45 | 6.27 | 4.24 | 3.03 | 2.21 |
| 30.0 | 20.93 | 9.56 | 5.82 | 3.94 | 2.80 | 2.02 |
| 35.0 | 18.18 | 8.73 | 5.38 | 3.65 | 2.58 | 1.84 |
| 40.0 | 15.90 | 7.96 | 4.95 | 3.35 | 2.35 | 1.65 |
| 45.0 | 13.97 | 7.24 | 4.53 | 3.05 | 2.11 | 1.45 |
| 50.0 | 12.31 | 6.56 | 4.12 | 2.75 | 1.87 | 1.25 |
| 55.0 | 10.86 | 5.91 | 3.71 | 2.45 | 1.63 | 1.04 |
| 60.0 | 9.57 | 5.30 | 3.30 | 2.14 | 1.37 | 0.82 |
| 65.0 | 8.41 | 4.70 | 2.90 | 1.83 | 1.12 | 0.60 |
| 70.0 | 7.35 | 4.12 | 2.49 | 1.51 | 0.85 | 0.36 |
| 75.0 | 6.38 | 3.55 | 2.09 | 1.18 | 0.57 | 0.12 |
| 80.0 | 5.47 | 3.00 | 1.68 | 0.85 | 0.28 | -0.14 |
| 85.0 | 4.61 | 2.45 | 1.26 | 0.50 | -0.02 | -0.41 |
| 90.0 | 3.79 | 1.90 | 0.83 | 0.14 | -0.34 | -0.70 |
| 95.0 | 3.01 | 1.35 | 0.39 | -0.24 | -0.68 | -1.01 |
Table 12 Multiplier (elasticities) with respect to a 10 percent increase in the rate of export tax in a more developed LDC (type 12) under balanced initial trade deficit (all figures are percent changes in the relevant variable)
| Initial rate
of export tax (percent) |
Worker welfare |
Export volume | Import volume |
GDP | Profits | Taxes* | Surplus |
| 5.0 | -0.90 | -5.38 | -5.38 | -3.30 | 0.27 | 1.37 | 6.40 |
| 10 0 | -0.89 | -5.51 | -5.51 | -3.34 | 0.20 | 1.28 | 5.82 |
| 15.0 | -0.89 | -5.64 | -5.64 | -3.38 | 0.11 | 1.20 | 5.26 |
| 20.0 | -0.88 | -5.79 | -5.79 | -3.42 | 0.03 | 1.11 | 4.73 |
| 25.0 | -0.87 | -5.95 | -5.95 | -3.46 | -0.06 | 1.02 | 4.22 |
| 30.0 | -0.87 | -6.11 | -6.11 | -3.49 | -0.16 | 0.93 | 3.73 |
| 35.0 | -0.87 | -6.29 | -6.29 | -3.53 | -0.26 | 0.84 | 3.26 |
| 40.0 | -0.87 | -6.48 | -6.48 | -3.55 | -0.36 | 0.75 | 2.80 |
| 45.0 | -0.88 | -6.68 | -6.68 | -3.58 | -0.47 | 0.66 | 2.35 |
| 50.0 | -0.89 | -6.90 | -6.90 | -3.59 | -0.58 | 0.57 | 1.92 |
| 55.0 | -0.90 | -7.13 | -7.13 | -3.58 | -0.70 | 0.48 | 1.49 |
| 60.0 | -0.92 | -7.39 | -7.39 | -3.56 | -0.83 | 0.39 | 1.07 |
| 65.0 | -0.94 | -7.67 | -7.67 | -3.51 | -0.97 | 0.31 | 0.66 |
| 70.0 | -0.98 | -7.97 | -7.97 | -3.43 | -1.11 | 0.22 | 0.25 |
| 75.0 | -1.02 | -8.31 | -8.31 | -3.28 | -1.27 | 0.14 | -0.16 |
| 80.0 | -1.07 | -8.68 | -8.68 | -3.06 | -1.44 | 0.07 | -0.57 |
| 85.0 | -1.13 | -9.08 | -9.08 | -2.72 | -1.61 | 0.01 | -0.98 |
| 90.0 | -1.21 | -9.54 | -9.54 | -2.17 | -1.81 | -0.03 | -1.39 |
| 95.0 | -1.31 | -10.05 | -10.05 | -1.20 | -2.02 | -0.04 | -1.82 |
* Change in Absolute Level of Taxes divided by Initial GDP.
It can be seen from Table 12, that for this economy, there is an initial level of export taxation, above which further taxation leads to a decline in the surplus. This initial level of taxation is quite high however, namely between 70 and 75 percent. Hence for lower levels of initial taxation the conclusion still holds that the surplus can be increased by increases in agricultural taxation.
Table 13 reproduces Table 11 for this type of more developed LDC. It is apparent that in all cases there is an optimum level of export taxation in the sense that if the initial level is below that, the total surplus can be increased with increased rates of agricultural taxation. This level, however, is quite high. The overall conclusion then is that in most types of agrarian developing economies, the economic surplus can indeed be increased by increases in agricultural taxation.