This chapter reviews recent theoretical work on the effect of factor mobility and the ensuing tax competition on the capacity of governments to raise revenue and redistribute income. It focuses on three issues: the relevance and limitations of the "race to the bottom" result, the benefits and pitfalls of partial coordination and the incidence of factors mobility on social security systems.
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ReDIF This chapter was published in: J. V. Henderson & J. F. Thisse (ed.) Handbook of Regional and Urban Economics, , chapter 57, pages 2529-2560, 2004.
Find related papers by JEL classification: R1 - Urban, Rural, and Regional Economics - - General Regional Economics
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