Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/172319
Authors: 
Dekker, Vincent
Strohmaier, Kristina
Year of Publication: 
2017
Series/Report no.: 
Hohenheim Discussion Papers in Business, Economics and Social Sciences 32-2017
Abstract: 
We analyse the effect of transfer pricing regulations on trade ows. We base our estimation on a panel gravity model, where the transfer pricing regulations are modeled as trade costs. To abstract from any aggregate demand shocks, we focus on intermediate goods in the car industry. Our results suggest a significant volume effect on the exported quantity as a result of the introduction of transfer pricing laws in the exporting country. Exports to lower tax rate countries are reduced, whilst exports to higher tax rate countries are increased. In line with theory, transfer pricing regulations only play a role if a tax rate difference exists between the trading partners.
Subjects: 
Panel Gravity Model
Transfer Pricing Regulations
Intermediate Goods Trade
Corporate Tax
JEL: 
F23
H25
H26
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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