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Taxation on Agglomeration

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  • Commendatore, P.

    (University of Naples)

  • Kubin, I.

    ()
    (University of Vienna)

Abstract

Recently, issues of international taxation have also been analysed from a New Economic Geography perspective. These discussions show that adding agglomerative forces can change the results considerably. In the paper, we introduce explicitly taxation and public expenditures into a Footloose Capital Model and investigate the local and global dynamic implications of such a public policy for industry agglomeration. It turns out that agglomeration can be highly sensitive wrt initial conditions and/or parameters and that these dynamic patterns are surprisingly robust wrt to the taxation principle.

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File URL: http://www1.fee.uva.nl/cendef/publications/papers/DIT_Final.pdf
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Bibliographic Info

Paper provided by Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance in its series CeNDEF Working Papers with number 06-08.

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Date of creation: 2006
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Handle: RePEc:ams:ndfwpp:06-08

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Postal: Dept. of Economics and Econometrics, Universiteit van Amsterdam, Roetersstraat 11, NL - 1018 WB Amsterdam, The Netherlands
Phone: + 31 20 525 52 58
Fax: + 31 20 525 52 83
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Web page: http://www.fee.uva.nl/cendef/
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  1. Currie, Martin & Kubin, Ingrid, 2006. "Chaos in the core-periphery model," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 60(2), pages 252-275, June.
  2. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
  3. Martin, Philippe & Rogers, Carol Ann, 1994. "Industrial Location and Public Infrastructure," CEPR Discussion Papers, C.E.P.R. Discussion Papers 909, C.E.P.R. Discussion Papers.
  4. Richard Baldwin; Paul Krugman, 2001. "Agglomeration, Integration and Tax Harmonization," IHEID Working Papers, Economics Section, The Graduate Institute of International Studies 01-2001, Economics Section, The Graduate Institute of International Studies.
  5. Rainald Borck & Michael Pflüger, 2004. "Agglomeration and Tax Competition," Discussion Papers of DIW Berlin 408, DIW Berlin, German Institute for Economic Research.
  6. Brulhart, Marius & Trionfetti, Federico, 2004. "Public expenditure, international specialisation and agglomeration," European Economic Review, Elsevier, Elsevier, vol. 48(4), pages 851-881, August.
  7. Jorgen W. Weibull, 1997. "Evolutionary Game Theory," MIT Press Books, The MIT Press, The MIT Press, edition 1, volume 1, number 0262731215, December.
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Cited by:
  1. Pasquale Commendatore & Ingrid Kubin & Carmelo Petraglia, 2008. "Productive Public Expenditure in a New Economic Geography Model," Economie Internationale, CEPII research center, CEPII research center, issue 114, pages 133-160.

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