The paper analyzes the impact of personal income taxes on strategic business taxation. It sets up a model of tax competition between small jurisdictions whose governments are revenue maximizers and use business taxes on the capital stock and on corporate profits as their policy instruments....

We extend the literature on local income tax competition by allowing for inter-jurisdictional spillovers and imperfect rivalry in consumption of a publicly provided good. Comparing decentralized second-best results of a theoretical model with an efficient benchmark, we identify three...

We investigate the influence of public policy on interprovincial migration in Canada using new aggregated migration data for 1974-1996, the longest period studied so far. We consider the consequences of regional variation in a variety of policies, and also investigate the effects of certain...

The impact of corporate income taxes on location decisions of firms is widely debated in the tax competition literature. Tax rate differences across jurisdictions may lead to distortions of firms investment decisions. Empirical evidence on tax induced relocation and subsequent economic...

We consider a world in which countries apply optimal taxes on mobile capital and savings (like in Bucovetsky and Wilson, 1991). Firms and savers may underreport income in order to avoid or evade taxation. We show that, even in the presence of underreporting, the equilibrium under tax competition...

This paper studies the effects of globalization on the ability of governments to generate tax revenues for the financing of national welfare states. In this context, it summarizes the theoretical predictions of various economic models of tax competition between countries and discusses the role...

This paper surveys and evaluates the corporation tax (CT) systems of the Member States of the European Union on the basis of a comprehensive taxonomy of actual and potential regimes, which have as their base either profits, profits and interest, or economic rents. The current regimes give rise...

This paper studies the optimal nonlinear income tax schedule at symmetric equilibria at which two symmetric states (or tax authorities) compete to attract more taxpayers from the other state. It differs from the existing literature in the sense that taxpayers' wages are endogenously determined...

The traditional normative literature on fiscal federalism argues that redistributive policies should be centralized in order to avoid welfare- or tax-induced migration. However, recent evidence shows that even in a setup where the progressivity of the income tax schedule is centralized to an...