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This paper brings out the special mechanism through which taxes influence bilateral FDI, when investment decisions are two-fold in the presence of fixed setup flows costs. For each pair of source-host countries, there is a set of factors determining whether aggregate FDI flows will occur at all,...
Persistent link: https://www.econbiz.de/10012782945
Many American communities seek to attract or retain businesses with tax abatements, tax credits, or tax increment financing of infrastructure projects (TIFs). The evidence for 1999 indicates that communities are most likely to offer one or more of these business development incentives if their...
Persistent link: https://www.econbiz.de/10013119961
I use a quantitative economic geography model to explore subsidy competition among U.S. states. I ask what motivates …-cooperative and cooperative subsidy choices and assess how far away we are from these extremes. I find that states have strong … closer to cooperative than non-cooperative subsidies but the potential losses from an escalation of subsidy competition are …
Persistent link: https://www.econbiz.de/10013027268
We analyze how China's emergence as a destination for foreign direct investment is affecting the ability of other countries to attract FDI. We do so using an approach that accounts for the endogeneity of China's FDI. The impact turns out to vary by region. China's rapid growth and attractions as...
Persistent link: https://www.econbiz.de/10013222647
We discuss recent cases of Chinese buyout activity in the OECD (especially in the US and the EU) in resource and manufacturing sectors. While most of the buyout attempts have been unsuccessful, they can serve as a catalyst for a wider discussion on the implications for global arrangements over...
Persistent link: https://www.econbiz.de/10013310167
education subsidy policy we demonstrate that the optimal subsidy for general education increases with the growth rate of …
Persistent link: https://www.econbiz.de/10013212567
When regulated firms are offered compensation to prevent them from relocating, efficiency requires that payments be distributed across firms so as to equalize marginal relocation probabilities, weighted by the damage caused by relocation. We formalize this fundamental economic logic and apply it...
Persistent link: https://www.econbiz.de/10013080845
This paper examines the likely impact of a proposed formula apportionment system for corporation tax in the EU on the inbound investment of US multinational companies. We pay attention to tax planning strategies that may be employed by US multinationals and investigate whether effective tax...
Persistent link: https://www.econbiz.de/10013118758
In the automobile industry, as in many tradable goods markets, firms usually earn their highest market share within their domestic market. The goal of this paper is to disentangle the supply- and demand-driven sources of the home market advantage. While trade costs, foreign production costs, and...
Persistent link: https://www.econbiz.de/10013014669
In this paper, we estimate the impact of increasing costs on foreign producers following a withdrawal of the United Kingdom from the European Union (popularly known as Brexit). Our predictions are based on simulations of a multicountry neoclassical growth model that includes multinational firms...
Persistent link: https://www.econbiz.de/10012960512