Country size and tax policy for international joint ventures in an integrated market

Yasuo Sanjo

International Review of Economics & Finance, 2013, vol. 27, issue C, 37-53

Abstract: We investigate international joint ventures in an integrated market using a two-country model with asymmetric sizes. We show that although the domestic firm in the small country is less efficient, it is possible that the government of the small country imposes a higher tax than that of the large country. Moreover, we show that even if the domestic firm in the large country is less efficient, a joint venture by this firm and the foreign firm could be more productive, and the foreign firm could prefer to form a joint venture partnership with the domestic firm in the large country.

Keywords: Joint ventures; Tax policy; Country size; Profit sharing (search for similar items in EconPapers)
JEL-codes: F23 H25 L24 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:27:y:2013:i:c:p:37-53

DOI: 10.1016/j.iref.2012.09.002

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