Jordi Jofre-Montseny () (Grup en Federalisme Fiscal i Economia Regional(Institut de Recerca en Economia - IEB), Departament d'Economia Política i Hisenda Pública, Universitat de Barcelona) Albert Solé-Ollé () (Grup en Federalisme Fiscal i Economia Regional(Institut de Recerca en Economia - IEB), Departament d'Economia Política i Hisenda Pública, Universitat de Barcelona)
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This paper analyses empirically how differences in local taxes affect the intraregional location of new manufacturing plants. These effects are examined within the random profit maximization framework while accounting for the presence of different types of agglomeration economies (localization/ urbanization/ Jacobs’ economies) at the municipal level. We look at the location decision of more than 10,000 establishments locating between 1996 and 2003 across more than 400 municipalities in Catalonia, a Spanish region. It is necessary to restrict the choice set to the local labor market and, above all, to control for agglomeration economies so as to identify the effects of taxes on the location of new establishments.
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Paper provided by Xarxa de Referència en Economia Aplicada (XREAP) in its series Working Papers with number
XREAP2007-05.
Length: 34 pages Date of creation: Jun 2007 Date of revision:
Jun 2007 Handle: RePEc:xrp:wpaper:xreap2007-05
Contact details of provider: Postal: Espai de Recerca en Economia, Facultat de Ci�ncies Econ�miques i Empresarials, Universitat de Barcelona, c/ Tinent Coronel Valenzuela, 1-11, 08034 Barcelona Phone: +34+934039653 Email: Web page: http://www.pcb.ub.es/xreap More information through EDIRC
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Find related papers by JEL classification: R3 - Urban, Rural, and Regional Economics - - Production Analysis and Firm Location H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
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