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Implicit tax co-ordination under repeated policy interactions

Marco Cotenaro and Jean-Pierre Vidal

Recherches économiques de Louvain, 2006, vol. 72, issue 1, 5-18

Abstract: In the context of a stylised game theoretical framework of capital tax competition, we show that when repeated policy interactions are associated to a systematic punishment of the deviating policymaker, a co-ordinated outcome can be the solution to the non co-operative tax game. This result suggests that explicit forms of policy co-ordination, such as a centralised tax authority, could in fact be largely unnecessary.

Keywords: policy co-ordination; international fiscal issues (search for similar items in EconPapers)
Date: 2006
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