Do governments tax agglomeration rents?
Empirical evidence suggests that firms receive rents from locating in economic agglomerations and industry clusters. Using the German local business tax as a testing ground, we empirically investigate whether these agglomeration rents are taxable for local governments. The analysis exploits a rich data source on the population of German plants to construct measures for the communities’ agglomeration characteristics. The findings indicate that economic agglomerations and industry clusters exert a positive impact on the jurisdictional tax rate choice. Further analysis moreover suggests that a municipality’s potential to tax agglomeration rents depends on its firm and industry agglomeration relative to neighboring communities. To account for potential endogeneity problems, our analysis exploits long-lagged population and infrastructure variables as instruments for the agglomeration measures.
Year of publication: |
2013-05
|
---|---|
Authors: | Koh, Hyun-Ju ; Riedel, Nadine ; Bohm, Tobias |
Saved in:
Online Resource
Type of publication: | Article |
---|---|
Language: | English |
Notes: | Koh, Hyun-Ju, Riedel, Nadine and Bohm, Tobias (2013) Do governments tax agglomeration rents? Journal of Urban Economics, 75. pp. 92-106. |
Other identifiers: | 10.1016/j.jue.2012.11.004 [DOI] |
Source: | BASE |
Persistent link: https://www.econbiz.de/10011426121
Saved in favorites
Similar items by person
-
On Selection into Public Civil Service
Bohm, Tobias, (2011)
-
On selection into public civil service
Bohm, Tobias, (2013)
-
Large and influential: firm size and governments' corporate tax rate choice?
Bohm, Tobias, (2016)
- More ...