When countries compete for the location of a new multinational plant they need to be aware of the profit shifting opportunities this new plant creates for the global multinational firm. By modelling explicitly the multinational's intra-firm transactions, we show that the home market advantage...

This paper discusses environmental policies in response to foreign direct investment (FDI) in a symmetrie two-country setting, where firms' behavior affects government policy decisions. We show that two alternative equilibria with FDI are possible: (i) one with unilateral FDI, where one firm is...

This paper constructs and analyzes a rudimentary game-theoretic model to better understand the policy choice between a global minimum tax regime that operates country-by-country and one that operates based on MNEs’ global average tax rates. The paper’s findings run counter to the consensus...

This paper models inter-jurisdiction competition for foreign direct investment and optimal government policy intervention to protect the national interest. The inter-jurisdiction competition for a multinational has the potential of favouring the multinational and of becoming detrimental for the...

The OECD’s Pillar One Blueprint proposes a new taxing right, Amount A, that would shift the pre-tax profits of multinational enterprises (MNEs) from Residence and Source jurisdictions to Market jurisdictions. The Amount A formula provides multiple opportunities for both MNEs and tax...

Political risk is a complex phenomenon. This complexity has incentivized scholars to take a piecemeal approach to understanding it. Nearly all scholarship has targeted a single type of political risk (expropriation) and, within this risk, a single type of firm (MNCs) and a single type of...