Standard Tax Competition and Increasing Returns

Signe Krogstrup

Journal of Public Economic Theory, 2008, vol. 10, issue 4, 547-561

Abstract: The “race to the bottom” result of the standard tax competition literature implies that capital taxes are competed downward as capital becomes more mobile. The new economic geography literature, in contrast, finds that increasing capital mobility can be associated with a rise in capital tax rates, or a “race to the top.” This paper derives the race to the top result from within the standard tax competition modeling framework augmented with agglomeration forces. When agglomeration forces are sufficiently strong, tax competition pressures are mitigated and capital taxes are instead driven by tax exporting incentives.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
https://doi.org/10.1111/j.1467-9779.2008.00376.x

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jpbect:v:10:y:2008:i:4:p:547-561

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1097-3923

Access Statistics for this article

Journal of Public Economic Theory is currently edited by Rabah Amir, Gareth Myles and Myrna Wooders

More articles in Journal of Public Economic Theory from Association for Public Economic Theory Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().