1.Consumer's surplus Commodity taxation: pi=PI+t, T=tx,(p, w) The loss of the taxation 1.=-E(p,p,1)-T=e(p,l)-e(p,l)-T P1 t Je [h(P1, P-l,u)=(P0+t, p-1, u)ldp. 2.D2=-CW(p°,p,w)-T=e(p,l)-e(p,u°)-T [(np,2)-(P+p,n2)n
1.Consumer’s surplus • Commodity taxation: • The loss of the taxation: 1. 2. 1 0 1 1 1 1 p p t T t x p w = + = , ( , ) 0 1 0 1 1 0 1 1 1 0 1 1 0 1 1 1 1 1 1 1 1 ( , , ) ( , ) ( , ) [ ( , , ) ( , , )] p t p L EV w T e u e u T h p u h p t u dp + − − = − − = − − = − + p p p p p p 0 1 0 1 2 0 1 1 0 0 0 0 0 0 1 1 1 1 1 1 1 ( , , ) ( , ) ( , ) [ ( , , ) ( , , )] p t p L CV w T e u e u T h p u h p t u dp + − − = − − = − − = − + p p p p p p
1.Consumers surplus P h1(P1,p1,a2) h1(P12p12) +t PI x(1,p1,w) h,(pi+t, p-l,u) h,(pi+t, p_,u)
1.Consumer’s surplus p1 x1 0 1 1 1 h p u ( , , ) p− 1 1 1 x p w ( , , ) p− 1 1 1 1 h p u ( , , ) p− 0 1 p 0 1 p t + 0 1 1 1 1 h p t u ( , , ) + p− 0 0 1 1 1 h p t u ( , , ) + p−