The paper employs a model of dynamic price competition to study how international commodity taxation affects the stability of collusive agreements when producers in an international duopoly agree not to export into each other’s home market. We consider both the choice of international tax...

This paper analyzes the development of the ratio of corporate taxes to wage taxes using a simple political economy model with workers and capitalists that own internationally mobile and immobile firms. Among other results, our model predicts that countries reduce their corporate tax rate,...

This paper addresses the optimal mix of capital and wage taxation when policymakers maximize the political support of workers and capitalists, subject to a fixed revenue requirement. Capital market integration increases the efficiency costs of a tax on capital hut simultaneously changes the...

Increased activity of multinational firms exposes national corporate tax bases to cross-country profit shifting, but also leads to rising profitability of the corporate sector. We incorporate these two effects of economic integration into a simple political economy model where the median voter...

There is little doubt that the step towards a monetary union in Europe will increase both the distortionary effects of existing differences in national tax systems and the intensity of tax competition for internationally mobile commodity and factor tax bases. This paper discusses selected issues...

We attempt to clarify the role of the production efficiency theorem in international capital taxation. It is shown that a direct open-economy analogue to the production efficiency theorem arises not in the small country case, but in the more general setting of tax competition between a finite...

Most systems of health care financing in EU member states currently include elements of income redistribution. The paper analyzes the effects of shifting this kind of redistribution to the tax system and argues that this reform could create two types of efficiency gains. On the expenditure side,...

The paper analyzes the effects of general commodity taxation under the restricted origin principle when the union countries are small relative to the rest of the world and trade deflection can be controlled by tax authorities. A change in the tax rate of one union country leads to two fiscal...

This paper evaluates the recent proposals for a co-ordinated capital tax policy in the European Union, focusing on an EU-wide minimum withholding tax on interest income and alternative ways to increase the effective tax rate on corporate profits. The analysis draws on current theoretical and...