This paper analyses a game theoretic model of tax competition in a system where tax authorities are revenue optimisers and countries are differentiated by size. The model accommodates more than two countries. In equilibrium, larger countries set higher tax rates non-cooperatively. By applying...

In this paper, we investigate internationalization strategies of German manufacturing firms in the European Union. We give reasons for the hypothesis that traditional market strategies had been replaced by border-crossing production networking based on the comparative advantage of host countries...

Regional integration is often considered a means to improve member countries’ attractiveness to foreign direct investment (FDI). But regional integration agreements (RIAs) as well as FDI are too diverse to allow for generalized verdicts. Our case studies on Mercosur in Latin America, ASEAN and...

It is often feared that tax competition might lead to a “race to the bottom”. The consequence of a decline of tax rates on capital income would be shrinking capital income tax revenues and difficulties for national governments to perform their usual tasks. The paper analyzes what happened to...

In this paper, the authors analyze the behavior of local governments on capital taxation when the financial choices in terms of a public good quality are done by a central planner. More specifically, they ask the question whether a local government has an interest to tax the mobile factor in...

For many years there have been political intentions to harmonize tax rates in Europe. As to capital income taxation, competition is often seen to be especially harmful. Facing a high degree of international capital mobility, every country is expected to reduce its tax rate in order to attract...

Swiss metropolitan areas are comprised of a system of communities with considerable fiscal autonomy. This study investigates how the income tax differentials across communities in an urban area affect the households` location decisions. Data from the urban agglomeration of Basel for the year...

This paper provides a set of detailed estimated fiscal reaction functions for a panel of twenty industrialized countries, and it discusses commonalities and differences with regard to systematic fiscal policies across countries. In general, the countries in the panel adjust tax revenues strongly...

We investigate the effects of a Financial Transaction Tax (FTT) in an order-driven artificial financial market. FTTs are meant to limit short-term speculative behavior by reducing the amount of excess liquidity in the system. To quantify these effects, adjustments in trading strategies and their...

The paper investigates the relationship between tax revenues and literacy level, using a panel-model approach. The dataset covers the period 1996 to 2010 and includes 123 countries. The estimations suggest that the assumed function is nonlinear, with inverted-U and U-shaped curves. More...