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Exploring the Likelihood of a Country Being a Tax Haven Using MIMIC Models

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  • Paulo Mourao

    (Department of Economics, University of Minho, Portugal)

Abstract

The multiple indicators multiple causes (MIMIC) framework is used to analyze dimensions related to causation and indicators of tax haven status. Robust results were obtained that identify a country's tax burden and area as causes of a country adopting policies usually observed in tax havens. The level of social security contributions as a proportion of public revenues and the ratio of indirect to direct taxes were found to be statistically significant indicators of tax havens. Data from 68 countries for more than twenty years were analyzed, enabling the results to contribute to a deepening of the current debate about tax havens and their socio-economic profiles.

Suggested Citation

  • Paulo Mourao, 2020. "Exploring the Likelihood of a Country Being a Tax Haven Using MIMIC Models," Econometric Research in Finance, SGH Warsaw School of Economics, Collegium of Economic Analysis, vol. 5(1), pages 17-32, June.
    • Handle: RePEc:sgh:erfinj:v:5:y:2020:i:1:p:17-32
    DOI: 10.2478/erfin-2020-0002
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    References listed on IDEAS

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    More about this item

    Keywords

    Tax Havens; MIMIC Models; Public Finances; Statistical Models;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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