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Felix Montag

Felix Montag is an assistant professor in economics at the Tuck School of Business at Dartmouth College and an affiliate fellow at the George J. Stigler Center for the Study of the Economy and the State at the University of Chicago Booth School of Business. He studies how firms with market power react to competition policy, trade policy, and taxes.
Fiscal Policy

How Well Consumers Know Prices Matters for Tax Policy

Felix Montag
The effectiveness of tax policy depends on whether sellers pass on changes in tax rates to consumers through changes in price. In new research, Felix Montag, Robin Mamrak, Alina Sagimuldina, and Monika Schnitzer investigate how this tax pass-through in turn depends on how much consumers know about prices. They show that if consumers are not aware of how prices for the same product vary between sellers, then they will be unaffected by tax changes intended to increase or decrease consumption.

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The publication of the Stigler Center at The University of Chicago Booth School of Business

ProMarket is dedicated to discussing how competition tends to be subverted by special interests. The posts represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty. For more information, please visit ProMarket Policy.