This study explores tariff cooperation under a representative democracy, comparing national welfare realized in three trading regimes: most favored nation (MFN), customs union (CU), and free trade agreement (FTA). Two points are addressed: Why have FTAs increased in recent decades when...

The role of endogenized leadership has been analyzed in detail in the tax competition literature. However, not many studies in the literature take capital inflow from outside of the countries under tax competition into consideration. To fill this gap, in this paper, we reconsider the endogenized...

In this study, we analyze asymmetric tax competition in the presence of capital agglomeration effects. As is well known from traditional studies of asymmetric tax competition, a pecuniary externality arises and distorts the efficiency of capital allocation between regions. We show that the...

This study examines asymmetric tax competition under representative democracy systems. The findings show that the degree of asymmetry between countries affects the result of elections in each country, where the citizens select a policy‐maker to set a tax rate for the country. In particular,...