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Does tax competition increase disparity among jurisdictions?
Han, Yutao; Pieretti, Patrice; Zou, Benteng
2015
 

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Keywords :
interjurisdictional competition; productivity catch-up; size asymmetry
Abstract :
[en] This paper investigates whether a less-developed economy can catch up with a more developed one when they compete for foreign direct investments. The main message of the paper is that jurisdictional competition can enable the lagging country to catch up if capital mobility is sufficiently high and the productivity gap is not too large. Further, we show that size asymmetry reinforces (weakens) the productivity catch-up resulting from interjurisdictional competition when the lagging economy is small (large). Finally, we demonstrate that the development gap widens when capital becomes less mobile, which is at odds with previous findings.
Disciplines :
Economic systems & public economics
Author, co-author :
Han, Yutao
Pieretti, Patrice ;  University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA)
Zou, Benteng ;  University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA)
Language :
English
Title :
Does tax competition increase disparity among jurisdictions?
Publication date :
2015
Available on ORBilu :
since 17 December 2015

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