Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/245620 
Year of Publication: 
2021
Series/Report no.: 
IZA Discussion Papers No. 14569
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Suárez Serrato and Zidar (2016) identify state corporate tax incidence in a spatial equilibrium model with imperfectly mobile firms. Their identification argument rests on comparative-statics omitting a channel implied by their model: the link between common determinants of a location's attractiveness and the average idiosyncratic productivity of firms choosing that location. This compositional margin causes the labor demand elasticity to be independent from the product demand elasticity, impeding the identification of incidence from the four estimated reduced-form effects. Assigning consensual values to the unidentified parameters, we find that the incidence share born by firm-owners is closer to 25% than 40%.
Subjects: 
incidence
corporate income tax
discrete/continuous choice
JEL: 
H22
H25
H32
H71
R23
R51
Document Type: 
Working Paper

Files in This Item:
File
Size
676.51 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.