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Thünen Series of Applied Economic Theory, Universität Rostock >
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http://hdl.handle.net/10419/39750
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| Title: | | Dynamic tax competition and public-sector modernisation  |
| Authors: | | Becker, Daniel Thomas |
| Issue Date: | | 2008 |
| Series/Report no.: | | Thünen-series of applied economic theory 56 [rev.] |
| Abstract: | | This paper addresses the question whether increased mobility of capital enhances public-sector modernisation. Public-sector modernisation is modelled as the accumulation of knowledge (or another accumulated production factor) that serves as an input in the government's production of a consumption good. The public-sector provides a direct transfer to households. The tax competition model in the background is a dynamic model in which capital flight induced by taxation is a process that takes time. The speed with which firms can relocate capital to other jurisdictions is taken as a measure of the degree of capital mobility. The main result of the paper is a contradiction of the idea that the competitive pressure caused by increased capital mobility enhances public sector modernisation. |
| Subjects: | | public-sector modernisation dynamic tax competition imperfect capital mobility |
| JEL: | | H11 H77 H54 O40 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Thünen Series of Applied Economic Theory, Universität Rostock
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