Tax havens or safe havens
Our aim is to explain how a small country can be viable as an international banking center (IBC). We build a model in which mobile investors choose between two banking centers located respectively in a small country and in a large country. These countries compete in two instruments, taxation and institutional infrastructure. It follows that an IBC can be a tax haven, a safe haven, or both. A small country that hosts an IBC is a safe haven when it is able to provide a high level of institutional infrastructure, whereas it chooses to be a tax haven when it cannot be competitive in institutional infrastructure. Even in this last case, an IBC need not be as bad as claimed in the general press because its presence fosters institutional competition across countries, which is ultimately beneficial to all investors.
|Date of creation:||2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (+352) 46 66 44
Fax: (+352) 46 66 44 ext 633
Web page: http://wwwen.uni.lu/research/fdef/crea
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Richard Baldwin; Paul Krugman, 2001.
"Agglomeration, Integration and Tax Harmonization,"
IHEID Working Papers
01-2001, Economics Section, The Graduate Institute of International Studies.
- Baldwin, Richard & Krugman, Paul, 2000. "Agglomeration, Integration and Tax Harmonization," CEPR Discussion Papers 2630, C.E.P.R. Discussion Papers.
- Richard E. Baldwin & Paul Krugman, 2002. "Agglomeration, Integration and Tax Harmonization," NBER Working Papers 9290, National Bureau of Economic Research, Inc.
- Kai A. Konrad, 2007.
"Mobile Tax Base as a Global Common,"
CESifo Working Paper Series
2144, CESifo Group Munich.
- Justman, Moshe & Thisse, Jacques-François & van Ypersele, Tanguy, 2001.
"Taking the Bite Out of Fiscal Competition,"
CEPR Discussion Papers
3109, C.E.P.R. Discussion Papers.
- Hindriks, Jean & Peralta, Susana & Weber, Shlomo, 2008.
"Competing in taxes and investment under fiscal equalization,"
Journal of Public Economics,
Elsevier, vol. 92(12), pages 2392-2402, December.
- Jean, HINDRIKS & Susana, PERALTA & Sholmo, WEBER, 2006. "Competing in taxes and investment under fiscal equalization," Discussion Papers (ECON - Département des Sciences Economiques) 2006062, Université catholique de Louvain, Département des Sciences Economiques.
- HINDRIKS, Jean & PERALTA, Susana & WEBER, Shlomo, 2006. "Competing in taxes and investment under fiscal equalization," CORE Discussion Papers 2006109, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Hindriks, Jean J.G. & Peralta, Susana & Weber, Shlomo, 2007. "Competing in Taxes and Investment under Fiscal Equalization," CEPR Discussion Papers 6431, C.E.P.R. Discussion Papers.
- Dharmapala, Dhammika & Hines Jr., James R., 2009.
"Which countries become tax havens?,"
Journal of Public Economics,
Elsevier, vol. 93(9-10), pages 1058-1068, October.
- Jean Hindriks & Gareth D. Myles, 2006.
"Intermediate Public Economics,"
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262083442, June.
- Streeten, Paul, 1993. "The special problems of small countries," World Development, Elsevier, vol. 21(2), pages 197-202, February.
- La Porta, Rafael & Lopez-de-Silanes, Florencio & Schleifer, Andrei & Vishny, Robert, 2001.
"Investor Protection and Corporate Governance,"
Working Paper Series
rwp01-017, Harvard University, John F. Kennedy School of Government.
- James R. Hines, 2010. "Treasure Islands," Journal of Economic Perspectives, American Economic Association, vol. 24(4), pages 103-26, Fall.
- Bucovetsky, S., 1991. "Asymmetric tax competition," Journal of Urban Economics, Elsevier, vol. 30(2), pages 167-181, September.
- Patrice Pieretti & Skerdilajda Zanaj, 2009.
"On tax competition, public goods provision and jurisdictions' size,"
CREA Discussion Paper Series
09-14, Center for Research in Economic Analysis, University of Luxembourg.
- Pieretti, Patrice & Zanaj, Skerdilajda, 2011. "On tax competition, public goods provision and jurisdictions' size," Journal of International Economics, Elsevier, vol. 84(1), pages 124-130, May.
- Hansson, Gustav & Olsson, Ola, 2006.
"Country Size and the Rule of Law: Resuscitating Montesquieu,"
Working Papers in Economics
200, University of Gothenburg, Department of Economics.
- Olsson, Ola & Hansson, Gustav, 2011. "Country size and the rule of law: Resuscitating Montesquieu," European Economic Review, Elsevier, vol. 55(5), pages 613-629, June.
- Gustav Hansson & Ola Olsson, 2006. "Country Size and the Rule of Law: Resuscitating Montesquieu," DEGIT Conference Papers c011_033, DEGIT, Dynamics, Economic Growth, and International Trade.
- Konrad, Kai A., 2008. "Mobile tax base as a global common," Munich Reprints in Economics 22088, University of Munich, Department of Economics.
- Gehrig, Thomas, 1998. "Competing markets," European Economic Review, Elsevier, vol. 42(2), pages 277-310, February.
- Hampton, Mark P. & Christensen, John, 2002. "Offshore Pariahs? Small Island Economies, Tax Havens, and the Re-configuration of Global Finance," World Development, Elsevier, vol. 30(9), pages 1657-1673, September.
- Alberto Alesina & Enrico Spolaore, 1995.
"On the Number and Size of Nations,"
NBER Working Papers
5050, National Bureau of Economic Research, Inc.
- PIERETTI, Patrice & ZANAJ, Skerdilajda, 2009. "On tax competition, public goods provision and jurisdictionsâ€™ size," CORE Discussion Papers 2009012, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Jack High (ed.), 2001. "Competition," Books, Edward Elgar, number 1751, March.
When requesting a correction, please mention this item's handle: RePEc:luc:wpaper:11-10. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Elisa Ferreira)
If references are entirely missing, you can add them using this form.