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Tax competition’s role in economic development

Author

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  • Zakariya Chabani

    (Istanbul University, Social Sciences Inst, Economics Faculty)

  • Mona Hamed

    (Istanbul University, Social Sciences Inst, Economics Faculty)

Abstract

Many theories of tax competition views that competition leads to inefficiently low tax rates and public expenditure levels. However, more recently other theories have been done in order to investigate the desirable effects of tax competition. Such as the benefices of raising total tax intake due to low corporate tax rates stimulating economic growth. Tax competition in Europe is a little bit different from international tax competition because we have to take in consideration the behavior of economic agents and public institutions in a specific geographic, political, economic and legal setting. This paper describes some approaches to extract the potential benefits of tax competition in order to develop European economy; we will see how tax competition handles inefficiencies in both the private sector and the public sector in Europe. We will also discuss how tax competition effects may represent important changes in the distribution of income.

Suggested Citation

  • Zakariya Chabani & Mona Hamed, 2015. "Tax competition’s role in economic development," EY International Congress on Economics II (EYC2015), November 5-6, 2015, Ankara, Turkey 202, Ekonomik Yaklasim Association.
    • Handle: RePEc:eyd:cp2015:202
    as

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    References listed on IDEAS

    as
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    6. James R. Hines Jr., 2005. "Do Tax Havens Flourish?," NBER Chapters, in: Tax Policy and the Economy, Volume 19, pages 65-100, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Keywords

    Tax Competition; European Economy; Economy Development; Income Distribution;
    All these keywords.

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