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Trade-offs Between Severance Tax Revenues and Coal Mining Employment

Published online by Cambridge University Press:  10 May 2017

Jill L. Findeis
Affiliation:
Pennsylvania State University, University Park
James S. Shortle
Affiliation:
Pennsylvania State University, University Park
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Abstract

A severance tax can provide local jurisdictions with additional revenues to finance economic development, yet the imposition of a tax may create coal industry employment losses. This research analyzes this issue by examining the demand for Pennsylvania steam coal, providing estimates of the unconditional own price elasticities of demand for coal in each of two demand regions. These estimates in conjunction with labor/output coefficient estimates are used to determine the extent to which coal employment in a region already witnessing slow mining industry growth will be negatively affected.

Type
Articles
Copyright
Copyright © 1985 Northeastern Agricultural and Resource Economics Association 

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Footnotes

The authors gratefully acknowledge the helpful comments of two anonymous reviewers.

References

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