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Political Fragmentation and the Evolution of National Tax Structures in the OECD

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Listed author(s):
  • John Ashworth

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  • Bruno Heyndels

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    Abstract

    This paper considers how tax structures in OECD countries change over time and how these changes are related to political fragmentation. Tax structures amongst OECD countries have become more uniform in the recent past (1965–1995) but it is less clear that this convergence satisfies time-series requirements. Evidence on stochastic convergence tends to suggest that there is evidence of persistence of shocks remaining over a considerable time period. A consideration of the countries where this persistence is most prevalent shows that there is significant correlation between high persistence and weak (coalition) governments, giving further weight to the theories of weak government. Copyright Kluwer Academic Publishers 2001

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    File URL: http://hdl.handle.net/10.1023/A:1011210722342
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    Article provided by Springer & International Institute of Public Finance in its journal International Tax and Public Finance.

    Volume (Year): 8 (2001)
    Issue (Month): 4 (August)
    Pages: 377-393

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    Handle: RePEc:kap:itaxpf:v:8:y:2001:i:4:p:377-393
    DOI: 10.1023/A:1011210722342
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    Keywords: tax structures; persistence; weak government hypothesis; fragmented government;

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    1. John Y. Campbell & N. Gregory Mankiw, 1987. "Are Output Fluctuations Transitory?," The Quarterly Journal of Economics, Oxford University Press, vol. 102(4), pages 857-880.
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    12. Rosa Capolupo, 1998. "Convergence in recent growth theories: a survey," Journal of Economic Studies, Emerald Group Publishing, vol. 25(6), pages 496-537, October.
    13. Volkerink, Bjørn & Haan, Jacob de, 2000. "Fragmented government effects on fiscal policy: new evidence," CCSO Working Papers 200006, University of Groningen, CCSO Centre for Economic Research.
    14. Campbell, John Y & Mankiw, N Gregory, 1987. "Permanent and Transitory Components in Macroeconomic Fluctuations," American Economic Review, American Economic Association, vol. 77(2), pages 111-117, May.
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    Cited by:

    1. Hansson, Åsa & Porter, Susan & Perry Williams, Susan, 2012. "The Effect of Political and Economic Factors on Corporate Tax Rates," Working Paper Series 942, Research Institute of Industrial Economics.
    2. Huber, Gerald & Kocher, Martin & Sutter, Matthias, 2003. "Government Strength, Power Dispersion in Governments and Budget Deficits in OECD-Countries: A Voting Power Approach," Public Choice, Springer, vol. 116(3-4), pages 333-350, September.
    3. 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.
    4. Ruiz, Fernando & Gerard, Marcel, 2008. "Is there evidence of strategic corporate tax interaction among EU countries?," MPRA Paper 10094, University Library of Munich, Germany.
    5. Miroslav Beblavý, 2011. "Why has the crisis been bad for private pensions, but good for the flat tax? The sustainability of ‘neoliberal’ reforms in the new EU member states," CEPS Papers 6313, Centre for European Policy Studies.
    6. Osterloh, Steffen & Debus, Marc, 2012. "Partisan politics in corporate taxation," European Journal of Political Economy, Elsevier, vol. 28(2), pages 192-207.
    7. Åsa Hansson & Susan Porter & Susan Williams, 2015. "The importance of the political process on corporate tax policy," Constitutional Political Economy, Springer, vol. 26(3), pages 281-306, September.
    8. Bharatee Dash & Angara Raja, 2014. "Do political determinants affect revenue collection? Evidence from the Indian states," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 61(3), pages 253-278, September.
    9. Roberto Ricciuti, 2004. "Political Fragmentation and Fiscal Outcomes," Public Choice, Springer, vol. 118(3_4), pages 365-388, 03.
    10. Peter Schwarz, 2007. "Does capital mobility reduce the corporate-labor tax ratio?," Public Choice, Springer, vol. 130(3), pages 363-380, March.
    11. Hans Pitlik, 2005. "Folgt die Steuerpolitik in der EU der Logik des Steuerwettbewerbs," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 256/2005, Department of Economics, University of Hohenheim, Germany.

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