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Under what circumstances does a single-market analysis of tax incidence give a good approximation of the...

  • Under what circumstances does a single-market analysis of tax incidence give a good approximation of the multimarket incidence?

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Single market analysis often generally gives good approximate of multimarket incidence when the resources that seek alternative employment as result of tax induced decreases in production in one of markets and is simultaneously absorved by many other markets.

Hencr overall it depends on degree to which tax induced resource flows in concentrated markets as well as degree to which displaced inputs have specialised uses in specific industry or sector.

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