Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/104214
Authors: 
Haufler, Andreas
Klemm, Alexander
Schjelderup, Guttorm
Year of Publication: 
2006
Series/Report no.: 
Munich Discussion Paper 2006-7
Abstract: 
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.
Subjects: 
capital and labour taxes
economic integration
multinational firms
JEL: 
H20
H73
F15
F23
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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