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Integration and Tax Competition: An Empirical Study of OECD Countries

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  • Hansson, Åsa

    ()
    (Department of Economics, Lund University)

  • Olofsdotter, Karin

    ()
    (Department of Economics, Lund University)

Abstract

This paper studies the effects of integration on capital taxation in a number of OECD countries. Unlike most previous papers on the subject, we combine key features from the new economic geography theory with the standard tax competition framework. We consider effective as well as statutory corporate tax rates and include several measures of agglomeration forces in the analysis. Our empirical findings provide some support for both models. We find that increased integration has a negative effect on corporate tax rates while agglomeration forces influence tax rates positively, though the latter result is sensitive to how agglomeration is measured.

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Bibliographic Info

Paper provided by Lund University, Department of Economics in its series Working Papers with number 2005:4.

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Length: 45 pages
Date of creation: 21 Jan 2005
Date of revision: 09 Feb 2005
Handle: RePEc:hhs:lunewp:2005_004

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Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/en
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Keywords: tax competition; new economic geography; economic integration;

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References

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  1. Kind, Hans Jarle & Schjelderup, Guttorm & Ulltveit-Moe, Karen-Helene, 1999. "Competing for Capital in a 'Lumpy' World," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2188, C.E.P.R. Discussion Papers.
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Citations

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Cited by:
  1. Osterloh, Steffen & Debus, Marc, 2012. "Partisan politics in corporate taxation," European Journal of Political Economy, Elsevier, vol. 28(2), pages 192-207.
  2. Osterloh, Steffen & Debus, Marc, 2009. "Partisan politics in corporate tax competition," ZEW Discussion Papers 09-078, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. Michael Devereux & Simon Loretz, 2012. "What do we know about corporate tax competition?," Working Papers, Oxford University Centre for Business Taxation 1229, Oxford University Centre for Business Taxation.
  4. Siroën, Jean-Marc & Brami Celentano, Alexandrine, 2007. "Mondialisation et politique fiscale au Brésil," Economics Papers from University Paris Dauphine 123456789/284, Paris Dauphine University.

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