G2TT
来源类型Discussion paper
规范类型论文
来源IDDP5494
DP5494 Information in Mechanism Design
Dirk Bergemann; Juuso Välimäki
发表日期2006-02-09
出版年2006
语种英语
摘要This paper brings out the special mechanism through which taxes influence bilateral FDI, when investment decisions are two-fold in the presence of fixed setup flows costs. For each pair of source-host countries, there is a set of factors determining whether aggregate FDI flows will occur at all, and a different set of factors determining the volume of FDI flows (provided that they occur). We develop a two-country tax competition model which yield an asymmetric Nash-equilibrium with high corporate tax rate and high level of public good provision in the rich source country for FDI outflows and with low corporate tax rate and low level of public good provision in the poor host country for FDI inflows. This is akin to the asymmetry among the EU 15 and EU 10 in the enlarged European Union, as of 2004. We also demonstrate that the notion that the mere international tax differentials are a key factor behind the direction and magnitude of FDI flows, the traditional race to the bottom argument in tax competition are too simple.
主题International Macroeconomics
关键词Enlarged european union Source-host country foreign direct investment Tax competition
URLhttps://cepr.org/publications/dp5494
来源智库Centre for Economic Policy Research (United Kingdom)
资源类型智库出版物
条目标识符http://119.78.100.153/handle/2XGU8XDN/534353
推荐引用方式
GB/T 7714
Dirk Bergemann,Juuso Välimäki. DP5494 Information in Mechanism Design. 2006.
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