This paper investigates the impact of separate accounting (SA) versus that of formula apportionment (FA) on investment decisions in high- and low-corporate income tax countries. As the investment decisions of multinational enterprises are commonly taken by managers and not by owners, the focus...

This article deals with the domestic location of German multinational firms which have affiliates in the Czech Republic. Due to the common border the Czech Republic represents an attractive target country for both vertical and horizontal direct investments. In the year 2009 the sum of direct and...

In 2009, the United Kingdom abolished the taxation of profits earned abroad and introduced a territorial tax system. Under the territorial system, firms have strong incentives to shift profits abroad. Using a difference-in-differences research design, we show that profits of UK subsidiaries in...

We here expand the static tax competition models in symmetric small regions, which were indicated by Zodrow and Mieszkowski (1986) and Wilson (1986), to a dynamic tax competition model in large regions, taking consideration of the regional asymmetry of productivity of public capital and the...

We develop a theory of economic disintegration that features both endogenously formed tax and trade policies. We show very generally that the economic disintegration of a country from an economic union leads to a deeper integration of international trade institutions. Moreover, we set up a...

This paper contributes to the theoretical understanding of strategic interactions of governments on global factor markets. We analyze carbon taxes and subsidies and their impact on national welfare in a fiscal federalism setting with international markets for capital and fossil resources, and...