Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/26093
Authors: 
Becker, Daniel Thomas
Rauscher, Michael
Year of Publication: 
2007
Series/Report no.: 
CESifo working paper 2048
Abstract: 
Is tax competition good for economic growth? The paper addresses this question by means of a simple model of endogenous growth. There are many small jurisdictions in a large federation and individual governments benevolently maximise the welfare of immobile residents. Investment is costly: Quadratic installation and de-installation costs limit the mobility of capital. The paper looks at optimal taxation and long-run growth. In particular, the effects of variations in the cost parameter on economic growth and taxation are considered. It is shown that balanced endogenous growth paths do not always exist and effects of changes in installation costs are ambiguous.
JEL: 
H21
H72
O41
Document Type: 
Working Paper

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