Assessing the Effects of Local Taxation Using Microgeographic Data

Gilles Duranton, Henry Overman and Laurent Gobillon

No 5856, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We study the impact of local taxation on the location and growth of firms. Our empirical methodology pairs establishments across jurisdictional boundaries to estimate the impact of taxation. Our approach improves on existing work as it corrects for unobserved establishment heterogeneity, for unobserved time-varying site specific effects, and for the endogeneity of local taxation. Applied to data for English manufacturing establishments we find that local taxation has a negative impact on employment growth, but no effect on entry.

Keywords: Local taxation; Spatial differencing; Borders; Regression discontinuity (search for similar items in EconPapers)
JEL-codes: H22 H71 R38 (search for similar items in EconPapers)
Date: 2006-09
New Economics Papers: this item is included in nep-geo, nep-pbe and nep-ure
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Citations: View citations in EconPapers (23)

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Related works:
Journal Article: Assessing the Effects of Local Taxation using Microgeographic Data (2011)
Working Paper: Assessing the effects of local taxation using microgeographic data (2011)
Working Paper: Assessing the Effects of Local Taxation using MicroGeographic Data (2011)
Working Paper: Assessing the Effects of Local Taxation using MicroGeographic Data (2011)
Working Paper: Assessing the Effects of Local Taxation using Microgeographic Data (2010)
Working Paper: Assessing the Effects of Local Taxation Using Microgeographic Data (2006)
Working Paper: Assessing the effects of local taxation using microgeographic data (2006)
Working Paper: Assessing the effects of local taxation using microgeographic data (2006)
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