Pareto Efficiency in International Taxation
This paper addresses a key but neglected task in the theory of international taxation, lent increased urgency by growing awareness of the potential gains from tax coordination: the characterization of Pareto-efficient international tax regimes. It shows that the Diamond- Mirrlees theorem on the desirability of production efficiency, which underlies the key tenets of policy advice in international taxation--- the desirability of destination basis for commodity taxation, of the residence principle for capital income taxation, and of free trade---is rendered inherently inapplicable to problems of international tax design by the distinctness of national budget constraints that is of the essence in thinking about international taxation. Conditions are established---relating to the availability of explicit or implicit devices for reallocating tax revenues across countries---under which production efficiency is nevertheless desirable, and a general characterization developed of the precise ways in which Pareto efficient international taxation may require violation of established tenets.
|Date of creation:||10 Dec 2001|
|Date of revision:|
|Note:||Type of Document - ; prepared on TeX; figures: request from author|
|Contact details of provider:|| Web page: http://econwpa.repec.org|
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.:
- Devarajan, Shantayanan & Go, Delfin & Schiff, Maurice & Suthiwart-Narueput, Sethaput, 1996. "The whys and why nots of export taxation," Policy Research Working Paper Series 1684, The World Bank.
- Keen, Michael & Lahiri, Sajal, 1994.
"The Comparison Between Destination and Origin Principles Under Imperfect Competition,"
Economics Discussion Papers
10023, University of Essex, Department of Economics.
- Keen, Michael & Lahiri, Sajal, 1998. "The comparison between destination and origin principles under imperfect competition," Journal of International Economics, Elsevier, vol. 45(2), pages 323-350, August.
- Michael Keen & Sajal Lahiri, 1994. "The comparison between destination and origin principles under imperfect competition," IFS Working Papers W94/08, Institute for Fiscal Studies.
- Peter A. Diamond & J. A. Mirrlees, 1968. "Optimal Taxation and Public Production," Working papers 22, Massachusetts Institute of Technology (MIT), Department of Economics.
- Ebrill, Liam P. & Slutsky, Steven M., 1989. "Decentralized decision making with common goals : The a[right ceiling]truists' dilemma and regulatory pricing," European Journal of Political Economy, Elsevier, vol. 5(2-3), pages 177-201.
- Richard Harris, 1976.
"Efficient Commodity Taxation,"
243, Queen's University, Department of Economics.
- Eggert, Wolfgang & Haufler, Andreas, 1999.
"Capital taxation and production efficiency in an open economy,"
Munich Reprints in Economics
20564, University of Munich, Department of Economics.
- Eggert, Wolfgang & Haufler, Andreas, 1999. "Capital taxation and production efficiency in an open economy," Economics Letters, Elsevier, vol. 62(1), pages 85-90, January.
- Huizinga, H. & Nielsen, S.B., 1995.
"Capital Income and Profits Taxation with Foreign Ownership of Firms,"
9582, Tilburg - Center for Economic Research.
- Huizinga, Harry & Nielsen, Soren Bo, 1997. "Capital income and profit taxation with foreign ownership of firms," Journal of International Economics, Elsevier, vol. 42(1-2), pages 149-165, February.
- Huizinga, H.P. & Nielsen, S.B., 1997. "Capital income and profit taxation with foreign ownership of firms," Other publications TiSEM b4f6a916-7f7f-4fe1-9cf0-c, Tilburg University, School of Economics and Management.
- Huizinga, H.P. & Nielsen, S.B., 1995. "Capital income and profits taxation with foreign ownership of firms," Discussion Paper 1995-82, Tilburg University, Center for Economic Research.
- Harry Huizinga & Soeren Bo Nielsen, . "Capital Income and Profits Taxation with Foreign Ownerwhip of Firms," EPRU Working Paper Series 95-09, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Dasgupta, Partha S & Stiglitz, Joseph E, 1974.
"Benefit-Cost Analysis and Trade Policies,"
Journal of Political Economy,
University of Chicago Press, vol. 82(1), pages 1-33, Jan.-Feb..
- Michael Keen & Hannu Piekkola, 1996.
"Simple rules for the optimal taxation of international capital income,"
IFS Working Papers
W96/18, Institute for Fiscal Studies.
- Keen, Michael & Piekkola, Hannu, 1997. " Simple Rules for the Optimal Taxation of International Capital Income," Scandinavian Journal of Economics, Wiley Blackwell, vol. 99(3), pages 447-61, September.
- Arja H. Turunen-Red & Alan D. Woodland, 1996. "Recent Developments in Multilateral Policy Reform," Canadian Journal of Economics, Canadian Economics Association, vol. 29(s1), pages 394-400, April.
- Alan J. Auerbach, 1982.
"The Theory of Excess Burden and Optimal Taxation,"
NBER Working Papers
1025, National Bureau of Economic Research, Inc.
- Boadway, R & Keen, M, 1996.
"Efficiency and the optimal direction of federal-state transfers,"
IFS Working Papers
W96/01, Institute for Fiscal Studies.
- Robin Boadway & Michael Keen, 1996. "Efficiency and the optimal direction of federal-state transfers," International Tax and Public Finance, Springer, vol. 3(2), pages 137-155, May.
- James R. Hines, Jr., 1998.
""Tax Sparing" and Direct Investment in Developing Countries,"
NBER Working Papers
6728, National Bureau of Economic Research, Inc.
- James R. Hines Jr., 2000. "Tax Sparing and Direct Investment in Developing Countries," NBER Chapters, in: International Taxation and Multinational Activity, pages 39-72 National Bureau of Economic Research, Inc.
- Bhagwati, Jagdish N & Brecher, Richard A & Hatta, Tatsuo, 1983. "The Generalized Theory of Transfers and Welfare: Bilateral Transfers in a Multilateral World," American Economic Review, American Economic Association, vol. 73(4), pages 606-18, September.
- Joseph E. Stiglitz, 1981.
"Self-Selection and Pareto Efficient Taxation,"
NBER Working Papers
0632, National Bureau of Economic Research, Inc.
- Lockwood, Ben, 1992.
"Commodity Tax Competition Under Destination and Origin Principles,"
CEPR Discussion Papers
733, C.E.P.R. Discussion Papers.
- Lockwood, Ben, 1993. "Commodity tax competition under destination and origin principles," Journal of Public Economics, Elsevier, vol. 52(2), pages 141-162, September.
- Michael Keen, 1993. "The welfare economics of tax co-ordination in the European Community : a survey," Fiscal Studies, Institute for Fiscal Studies, vol. 14(2), pages 15-36, February.
- Wildasin, David E., 1984. "The welfare effects of intergovernmental grants in an economy with distortionary local taxes : A simple general equilibrium analysis," Journal of Public Economics, Elsevier, vol. 25(1-2), pages 103-125, November.
- Stefan Homburg, 1999. "Competition and Co-ordination in International Capital Income Taxation," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 56(1), pages 1-17, March.
- Partha Dasgupta & Joseph Stiglitz, 1972. "On Optimal Taxation and Public Production," Review of Economic Studies, Oxford University Press, vol. 39(1), pages 87-103.
- Kotsogiannis, Christos & Makris, Miltiadis, 2002. "On production efficiency in federal systems," Economics Letters, Elsevier, vol. 76(2), pages 281-287, July.
- Ebrill, Liam P. & Slutsky, Steven M., 1990. "Production efficiency and optimal pricing in intermediate-good regulated industries," International Journal of Industrial Organization, Elsevier, vol. 8(3), pages 417-442, September.
- Roger H. Gordon, 1983. "An Optimal Taxation Approach to Fiscal Federalism," The Quarterly Journal of Economics, Oxford University Press, vol. 98(4), pages 567-586.
- W. E. Diewert & A. H. Turunen-Red & A. D. Woodland, 1989. "Productivity- and Pareto-Improving Changes in Taxes and Tariffs," Review of Economic Studies, Oxford University Press, vol. 56(2), pages 199-215.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwppe:0112003. 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: (EconWPA)
If references are entirely missing, you can add them using this form.