This paper explores abatement investment and location responses to environmental policy, which takes the form of emission taxes or tradeable emission permits and subsidies against the costs of abatement investment, under uncertainty and irreversibility. Uncertainty is associated with output...

Unemployment rates differ widely across local labor markets. I offer new empirical evidence that high local unemployment emerges because of elevated local job losing rates. Local employers, rather than local workers, account for most of spatial gaps in job stability. I then propose a theory in...

We develop a dynamic spatial general equilibrium model with forward-looking investment and migration decisions. We characterize analytically the transition path of the spatial distribution of economic activity in response to shocks. We apply our framework to the reallocation of US economic...

Puerto Rico operated as a tax haven under U.S. Internal Revenue Code (IRC) Section 936. Firms in the pharmaceutical industry accounted for approximately 50% of tax credits awarded and 20% of employment under the program. The U.S. Congress eliminated the tax exemption program in 2006, creating a...

We study the effects of tax laws on foreign direct investment (FDI) and direct investment abroad (DIA), distinguishing in each case between investment financed by retained earnings and investment financed by transfers from abroad. We find that tax policy, through its effect on the rate-of-return...

Puzzling results of a positive association between the number of physicians per capita and the level of fees for physician services have been reported in the literature. These results may be due to misspecification of econometric models and use of data aggre-gated across medical specialties. It...

Tax policy toward the overseas income of U.S. firms is an important issue since foreign investment accounts for a sizabLe fraction of total investment by U.S. firms. At present there is no consensus on the degree to which U.S. firms respond to tax incentives when making international investment...

The purpose of this paper is to examine the relations among characteristics of U.S. firms, their tendency to invest abroad, and their choice of production locations. The larger the firm, and the higher its profitability, capital intensity, technological Intensity, and the skill level ofits labor...

Usually transportation/communication (t/c) considerations appear as only two in a long list of factors which determine headquarters location patterns. The research reported here singles out t/c considerations as the logical basis for headquarters location decisions. We ask: to what degree do...

Why do some firms adopt certain tax havens and how sensitive is the demand for tax havens? We address these questions by studying how the repeal of Section 936 tax credits affected firms with affiliates in Puerto Rico. We first describe the characteristics of US multinationals that were exposed...