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The effect of the corporate tax rate on the trade balance


  • Koichi Yoshimine
  • Stefan Norrbin


Past research indicates that MNCs may be engaging in income shifting practices. Such practices could bias the trade balance, if the intrafirm trade is substantial. This article examines the effect of the tax differential on the trade balances of OECD countries. The results indicate that the trade balance is adversely affected when the tax differential is positive, for a number of countries.

Suggested Citation

  • Koichi Yoshimine & Stefan Norrbin, 2007. "The effect of the corporate tax rate on the trade balance," Applied Economics Letters, Taylor & Francis Journals, vol. 14(5), pages 343-347.
  • Handle: RePEc:taf:apeclt:v:14:y:2007:i:5:p:343-347
    DOI: 10.1080/13504850500426301

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    Cited by:

    1. Alex Augusto Timm Rathke, 2015. "Note on tax enforcement and transfer pricing manipulation," Papers 1506.08743,
    2. Rathke, Alex Augusto Timm, 2015. "Note on tax enforcement and transfer pricing manipulation," MPRA Paper 65337, University Library of Munich, Germany.

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