The Influence of globalization on taxes and social policy - an empirical enalysis for OECD countries
AbstractUsing panel regression for the period 1970-2000 the paper analyzes whether globalization has influenced the OECD countries' social and overall spending as well as their implicit tax rates on labor, consumption and capital. Accounting for potential endogeneity of the regressors, the results show that globalization (measured by an index covering 23 variables) did not decrease the leeway for independent economic policy. Globalization even increased implicit tax rates on capital – a result that is mainly driven by economic integration. Depending on the method of estimation, increasing social integration also plays a role, while political integration does not matter for economic policy.
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Bibliographic InfoPaper provided by Exeter University, Department of Economics in its series Discussion Papers with number 0301.
Date of creation: Sep 2003
Date of revision:
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More information through EDIRC
globalization; economic policy; government expenditure; social spending; implicit tax rates; dynamic panel;
Other versions of this item:
- Dreher, Axel, 2006. "The influence of globalization on taxes and social policy: An empirical analysis for OECD countries," European Journal of Political Economy, Elsevier, vol. 22(1), pages 179-201, March.
- Axel Dreher, 2003. "The Influence of Globalization on Taxes and Social Policy – an Empirical Analysis for OECD Countries," Public Economics 0310002, EconWPA, revised 27 Feb 2004.
- H7 - Public Economics - - State and Local Government; Intergovernmental Relations
- H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
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