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Coordination and the fight against tax havens

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  • Konrad, Kai A.
  • Stolper, Tim

Abstract

The success or failure of the fight against tax havens is the outcome of a coordination game between a tax haven and its potential investors. Key determinants are the costly international pressure and the haven country's revenue pool. The latter is determined endogenously by the decisions of many individual investors. Our findings explain why some havens attract large sources of international investment and earn large revenues while other countries do not, and why their profits are not competed away. We identify a trade-off between fighting tax havens and high tax rates or, similarly, small fines for disclosed tax evasion.

Suggested Citation

  • Konrad, Kai A. & Stolper, Tim, 2015. "Coordination and the fight against tax havens," CEPR Discussion Papers 10519, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:10519
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    Cited by:

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    2. Katarzyna Bilicka & André Seidel, 2020. "Profit shifting and corruption," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(5), pages 1051-1080, October.
    3. Ludger Schuknecht & Vincent Siegerink, 2021. "The Political Economy of the International Tax Transparency Agenda in the G20/OECD Context," CESifo Working Paper Series 8813, CESifo.
    4. Matthew Gould & Matthew D. Rablen, 2020. "Voluntary disclosure schemes for offshore tax evasion," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(4), pages 805-831, August.
    5. Egger, Peter H. & Strecker, Nora M. & Zoller-Rydzek, Benedikt, 2020. "Estimating bargaining-related tax advantages of multinational firms," Journal of International Economics, Elsevier, vol. 122(C).
    6. Thomas A. Gresik & Kai A. Konrad, 2017. "Tax Havens, Accounting Experts, and Fee-Setting Rules," CESifo Working Paper Series 6774, CESifo.
    7. Marcelo Arbex & Sidney Caetano, 2016. "Welfare Implications of AEoI," Working Papers 1608, University of Windsor, Department of Economics.

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    More about this item

    Keywords

    initiatives against harmful tax practices; tax evasion; tax havens;
    All these keywords.

    JEL classification:

    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods

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