The paper compares productive efficiency in public and private firms. We study a principal-agent model in which the firm's manager is privately informed about a cost parameter and exerts unobservable cost reducing effort, while the owner can conduct costly audits to obtain information about the...

This paper reviews the recent theoretical literature that analyzes the European Union's policy to eliminate preferential corporate-tax regimes and the proposal to introduce a consolidated EU tax base with formula apportionment for the taxation of multinational firms. Since neither proposal...

In this paper we analyze the implications for the national provision of public inputs when profit shifting is possible, albeit costly, for internationally integrated firms. In this case a high level of public infrastructure will attract real investment, but the firm can at least partly avoid to...

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