Trade liberalization leads to significant changes in countries’ economic structures. The implied variation in the level and nature of specialization has important consequences for liberalizing economies. It is therefore extremely relevant for those countries pursuing trade liberalization...

Recent contributions on tax competition recognize the interaction between both horizontal and vertical tax externalities in a single federation. In this paper, we extend the theoretical analysis to a framework with multiple federations (a Union). We show that the relative size of a federation in...