Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/75662 
Year of Publication: 
2000
Series/Report no.: 
CESifo Working Paper No. 370
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
This paper analyzes fiscal competition among numerous spatially- separated jurisdictions in an explicitly dynamic framework. The degree of factor mobility between jurisdictions is imperfect because it is costly and time-consuming to adjust factor stocks. Even if it is harmful in the long run, a jurisdiction's residents can benefit in the short run from taxing mobile factors owned by non-residents. The optimal tax on mobile factors is lower, the faster the speed with which factors adjust to fiscal policy. Anticipated taxes are less beneficial than those that can be imposed unexpectedly.
JEL: 
H00
R00
Document Type: 
Working Paper
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