Government Collusion in Janeba’s Model of Multijurisdictional Tax Competition

Lloyd Barton

No 269370, Economic Research Papers from University of Warwick - Department of Economics

Abstract: Eckhard Janeba (Dec 2000 “Tax Competition when Governments lack Commitment” American Economic Review 90, 1508-19) has recently suggested a novel approach to modelling the relationship between governments and multinational firms. As part of ongoing research into various aspects of multijurisdictional tax competition, this paper investigates the possibility of allowing for collusion between governments when setting tax rates in the model. The findings show that a self-enforcing agreement is possible, with the beneficial effect of cutting the firm’s excess profits, limiting investment in excess capacity, and raising government revenue.

Keywords: Agricultural and Food Policy; Financial Economics; Political Economy (search for similar items in EconPapers)
Pages: 8
Date: 2001-08-08
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:269370

DOI: 10.22004/ag.econ.269370

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