EconPapers    
Economics at your fingertips  
 

The Role of Corporate Taxation in a Large Welfare State

Christian Keuschnigg

University of St. Gallen Department of Economics working paper series 2009 from Department of Economics, University of St. Gallen

Abstract: In comparing the impact of corporate taxation and social insurance on foreign direct investment (FDI) and unemployment, the paper derives four main results: (i) the optimal size of the welfare state depends on the degree of risk-aversion, the unemployment rate and the excess burden of labor taxes. Unemployment partly reflects the country's exposure to globalization; (ii) corporate taxation and social insurance can have equivalent effects on unemployment and outbound FDI; (iii) while an increase in the corporate tax raises corporate tax revenue, it is likely to worsen total fiscal stance; (iv) a corporate tax should be used to contribute to welfare state financing only in exceptional cases.

Keywords: Corporate tax; foreign direct investment; unemployment; welfare state (search for similar items in EconPapers)
JEL-codes: F21 H21 H53 J64 J65 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc
Date: 2009-08
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
http://ux-tauri.unisg.ch/RePEc/usg/dp2009/DP-0923-Ke.pdf (application/pdf)

Related works:
Journal Article: The Role of Corporate Taxation in a Large Welfare State (2009) Downloads
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:usg:dp2009:2009-23

Access Statistics for this paper

More papers in University of St. Gallen Department of Economics working paper series 2009 from Department of Economics, University of St. Gallen Contact information at EDIRC.
Series data maintained by Martina Flockerzi ().

 
Page updated 2017-09-29
Handle: RePEc:usg:dp2009:2009-23