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Mineral Taxation in Jamaica: An Oligopoly Confronts Taxes on Resource Rents — and Prevails

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  • M. H. I. Dore

Abstract

. The reallocative effects on bauxite production in Jamaica following the imposition of an ad valorem tax in 1974 are considered. The international aluminum industry, being both vertically and horizontally integrated, evolved a successful strategy of time‐phasing bauxite production capacity worldwide. The non‐neutral tax not only made Jamaican bauxite uncompetitive with the output of other producers but also eroded the cost differential between bauxite and alternative sources of aluminum ore. The study claims that the consequences of the tax have been disastrous, and it argues that the ad valorem tax on the recovered ore must be replaced by some form of a profits‐based tax.

Suggested Citation

  • M. H. I. Dore, 1987. "Mineral Taxation in Jamaica: An Oligopoly Confronts Taxes on Resource Rents — and Prevails," American Journal of Economics and Sociology, Wiley Blackwell, vol. 46(2), pages 179-203, April.
    • Handle: RePEc:bla:ajecsc:v:46:y:1987:i:2:p:179-203
    DOI: 10.1111/j.1536-7150.1987.tb01954.x
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    References listed on IDEAS

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    1. Pindyck, Robert S, 1979. "The Cartelization of World Commodity Markets," American Economic Review, American Economic Association, vol. 69(2), pages 154-158, May.
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    1. Yıldız, Taşkın Deniz, 2022. "How can the state rights be calculated by considering a high share of state right in mining operating costs in Turkey?," Resources Policy, Elsevier, vol. 75(C).

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