Even small trade costs restore efficiency in tax competition
AbstractWe introduce transport cost of trade in products into the classical Zodrow and Mieszkowski (1986) model of capital tax competition. It turns out that even small levels of transport cost lead to a complete breakdown of the seminal result, the underprovision of public goods. Instead, there is a symmetric equilibrium with efficient public goods provision in all jurisdictions.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Urban Economics.
Volume (Year): 72 (2012)
Issue (Month): 2 ()
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Web page: http://www.elsevier.com/locate/inca/622905
Tax competition; Public goods provision; Trade;
Other versions of this item:
- Johannes Becker & Marco Runkel, 2010. "Even Small Trade Costs Restore Efficiency in Tax Competition," CESifo Working Paper Series 3221, CESifo Group Munich.
- Johannes Becker & Marco Runkel, 2010. "Even Small Trade Costs Restore Efficiency in Tax Competition," FEMM Working Papers 100023, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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