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Tax Competition : Is It a Source of the Corporate Savings Glut?

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  • Kawamoto,Atsushi
  • Muraki,Kei

Abstract

This paper examines the determinants of corporate savings in a cross-country panel setting. Specifically, it employs firm-level data covering more than 540,000 firm-year observations for 12 advanced and emerging market economies. Panel regression results suggest that reductions in statutory corporate income tax rates can explain one-third of the rise in corporate savings (defined as net financial assets) in 2003-17. This finding is supported by a propensity scores matching analysis of the effects of changes in corporate income tax rates.

Suggested Citation

  • Kawamoto,Atsushi & Muraki,Kei, 2020. "Tax Competition : Is It a Source of the Corporate Savings Glut?," Policy Research Working Paper Series 9302, The World Bank.
    • Handle: RePEc:wbk:wbrwps:9302
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    References listed on IDEAS

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