The paper studies how the optimal nonlinear quantity-payment allocation can be truthfully implemented by optional tariffs in a differentiated goods duopoly. Consumers choose from a menu of tariffs and are subsequently billed according to this. We find that implementation by simple two part...

In this paper, we compare ad valorem and specific taxation under heterogeneous demand when a monopolist offers a menu of two-part tariffs. An increase in either tax rate leads to a higher usage fee for all consumers, whereas the fixed fee under reasonable assumptions will fall. If the government...

The economics of crime and punishment postulates that higher punishment leads to lower crime levels, or less severe crime. It is however hard to get empirical support for this intuitive relationship. This paper offers a model that contributes to explain why this is the case. We show that if...