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Estimating The Rivalness Of State-Level Inward Fdi

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  • Marius Brülhart
  • Kurt Schmidheiny

Abstract

type="main"> We develop a method for estimating the rivalness of tax bases using the structures of the conditional logit, Poisson, and nested logit models. As an illustration, we apply this method to estimate the effect of state-level capital taxation on U.S. inward foreign direct investment (FDI). The assumption of perfect nonrivalness can in some cases be rejected, but the assumption of perfect rivalness cannot. Competition over FDI across U.S. states could well be a zero-sum game.

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  • Marius Brülhart & Kurt Schmidheiny, 2015. "Estimating The Rivalness Of State-Level Inward Fdi," Journal of Regional Science, Wiley Blackwell, vol. 55(1), pages 139-148, January.
  • Handle: RePEc:bla:jregsc:v:55:y:2015:i:1:p:139-148
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    Cited by:

    1. Brülhart, Marius & Bucovetsky, Sam & Schmidheiny, Kurt, 2015. "Taxes in Cities," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 1123-1196, Elsevier.
    2. Azémar, Céline & Desbordes, Rodolphe & Wooton, Ian, 2020. "Is international tax competition only about taxes? A market-based perspective," Journal of Comparative Economics, Elsevier, vol. 48(4), pages 891-912.
    3. Steven Brakman & Charles Marrewijk & Mark Partridge, 2015. "Local Consequences Of Global Production Processes," Journal of Regional Science, Wiley Blackwell, vol. 55(1), pages 1-9, January.

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    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects

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