When a region successfully attracts a large firm by offering tax concessions, outright subsidies etc., the firm often commits itself to performance targets in terms of investment or employment. This paper interprets these contractually fixed targets as a consequence of incomplete information. It...

This paper deals with discrete labour supply decisions of different groups of persons in response to a change in net wage rates. The centrepiece of this approach is individuals' switching between working time categories, while facing switching costs that arise when people expand or reduce...

This paper considers optimal linear tax structures that are differentiated according to group membership. Groups can be heterogeneous with respect to both preferences and abilities. Contrary to most arguments in favour of tax privileges for certain groups, e.g. gender-based taxation, it is shown...

We analyze the optimal tax choices of a revenue-maximizing government that levies taxes from firms of which the true degree of mobility is ex ante unknown. Differential tax treatment of immobile and mobile firms is ruled out, but the government may learn from the firms' location responses to...