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Title:Partial tax coordination in a repeated game setting PDF Logo
Authors:Itaya, Jun-ichi
Okamura, Makoto
Yamaguchi, Chikara
Issue Date:2010
Series/Report no.:CESifo working paper Public Finance 3127
Abstract:This paper addresses the problem of partial tax coordination among regional or national sovereign governments in a repeated game setting. We show that partial tax coordination is more likely to prevail if the number of regions in a coalition subgroup is smaller and the number of existing regions in the entire economy is larger. We also show that under linear utility, partial tax coordination is more likely to prevail if the preference for a local public good is stronger. The main driving force for these results is the response of the intensity of tax competition. The increased (decreased) intensity of tax competition makes partial tax coordination more (less) sustainable.
Subjects:partial tax coordination
repeated game
tax competition
JEL:H71
H77
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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