Recent research into weak productivity performance since the financial crisis has highlighted the importance of the gap between the most productive firms and the rest. While wage compression may only be one possible mechanism to promote the relative growth of productive firms, it does appear to...

It is often argued that tax competition may lead to a 'race to the bottom'. This result may indeed hold in the case of factor mobility (such as capital). However, in this paper we emphasize the unique feature of labor migration, that may nullify the 'race to the bottom' hypothesis. Labor...