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Search costs and corporate income tax competition

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  • Konrad, Kai A.

Abstract

If a small cost applies for learning the corporate tax rules in different countries, this can completely eliminate tax competition. This modified version of the Diamond paradox and can also explain the empirically observed tax cuts cum base broadening.

Suggested Citation

  • Konrad, Kai A., 2011. "Search costs and corporate income tax competition," Economics Letters, Elsevier, vol. 112(2), pages 213-215, August.
  • Handle: RePEc:eee:ecolet:v:112:y:2011:i:2:p:213-215
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    References listed on IDEAS

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    1. Fuest, Clemens & Huber, Bernd & Mintz, Jack, 2005. "Capital Mobility and Tax Competition," Foundations and Trends(R) in Microeconomics, now publishers, vol. 1(1), pages 1-62, December.
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    Cited by:

    1. Keisuke Kawata, 2013. "Capital market integration and optimal employment protection policies," IDEC DP2 Series 3-9, Hiroshima University, Graduate School for International Development and Cooperation (IDEC).
    2. Becker, Johannes & Runkel, Marco, 2012. "Even small trade costs restore efficiency in tax competition," Journal of Urban Economics, Elsevier, vol. 72(2), pages 191-195.

    More about this item

    Keywords

    Costly search Tax competition Corporate taxation Monopoly pricing paradox;

    JEL classification:

    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods

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