We develop a conceptual framework which captures the effect of the VAT system on profit by two effective taxes. This … taxable income to an indirect tax setting. We bring the theory to the data, using linked administrative VAT and corporation … tax records in the UK from 2004-2009. Consistently with the theory, voluntary registration is positively related to the …

profit. Setting up a model that allows for profitable and loss-making affiliates of multinationals, we show that profit … equilibrium, affiliates might over-invest and the bunching-related investment effects generate a tendency for too high profit …

leisure increased most in France and least in the U.S. Contrary to what standard theory predicts, home hours changed … feed in taxes and labor productivities. To obtain this result it is crucial to measure the labor productivity of home …

drives low-productivity firms from the small country's home market, replacing them with high-productivity exporters from … abroad. This endogenous policy response creates a selection effect that increases the average productivity of home firms when …

We develop a theory of a firm in an incomplete contracts environment which decides on its complexity, organization, and …

elsewhere) can be used by multinational firms which have different productivity to serve the market abroad when product chains … abroad by either horizontal or vertical FDI. Upon opening a market to trade, firms with the lowest productivity will exit …, those with intermediate productivity will export, and those with higher productivity will choose fragmentation. Among the …

, favoring high-productivity firms is indeed the optimal policy. When tax competition is aggressive and profit taxes are low …Heterogeneous firm productivity seems to provide an argument for governments to pursue ‘pick-the-winner' strategies by … the optimal structure of tax differentiation depends critically on the feasible level of corporate profit taxes, which in …

output and average productivity, with stronger positive productivity effects for newly imported intermediate inputs. However …