Skip to main content
Open Access Publications from the University of California

Optimal taxation with joint production of agriculture and rural amenities


We show that, when there is joint production of an agricultural good and rural amenities, the first-best allocation of resources can be implemented with a tax on the agricultural good and some subsidies on the production factors (land and labor). The use of a subsidy on the agricultural good can only be explained by the desire of the policymaker to redistribute income from the consumers to the farmers.

Main Content
For improved accessibility of PDF content, download the file to your device.
Current View