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dc.contributor.authorBecker, Johannesen_US
dc.contributor.authorFuest, Clemensen_US
dc.contributor.authorHemmelgarn, Thomasen_US
dc.date.accessioned2006-09-05en_US
dc.date.accessioned2009-07-28T08:11:53Z-
dc.date.available2009-07-28T08:11:53Z-
dc.date.issued2006en_US
dc.identifier.urihttp://hdl.handle.net/10419/25767-
dc.description.abstractDoes the reduction of the effective tax burden on corporations trigger foreign direct investment? We take the German tax reform of 2000 as a natural experiment in order to isolate the impact of corporate taxation on the investment of foreign-held affiliates in Germany. We do so by exploiting the very rich MiDi data base from the Deutsche Bundesbank. Although we deliberately choose an approach which is likely to underestimate the tax effects on investment we find significant evidence that the tax reduction had the intended effect of - ceteris paribus - fostering inward direct investment. We find an elasticity of inward foreign direct investment with respect to the effective marginal tax rate of -0.7. We repeat the analysis for different subgroups and find high degrees of heterogeneity. Our results do not allow to decide whether the model of discrete investment choices or the model of marginal adjustment of the capital stock performs better in explaining the investment data.en_US
dc.language.isoengen_US
dc.publisherCESifo Münchenen_US
dc.relation.ispartofseriesCESifo working paper 1722en_US
dc.subject.jelH25en_US
dc.subject.jelH21en_US
dc.subject.ddc330en_US
dc.titleCorporate tax Reform and foreign direct investment in Germany: evidence from firm-level dataen_US
dc.typeWorking Paperen_US
dc.identifier.ppn516983512en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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