Resource title

Globalisation and the mix of wage and profit taxes

Resource image

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Resource description

This paper analyses the development of the ratio of corporate taxes to wage taxes using a simple political economy model with internationally mobile and immobile firms. Among other results, our model predicts that countries reduce their corporate tax rate, relative to the wage tax, either when preferences for public goods increase or when a rising share of capital is employed in multinational firms. The predicted relationships are tested using panel data for 23 OECD countries for the period 1980 through 2001. The results of the empirical analysis support our central hypotheses.

Resource author

Andreas Haufler, Alexander Klemm, Guttorm Schjelderup

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/19142

Resource license

Adapt according to the presented license agreement and reference the original author.