Dehejia, Vivek Harsha; Weichenrieder, Alfons J. - 2000
This paper reconsiders the welfare effects of "tariff jumping" direct investment if mobile capital is subjected to … taxation. In contrast to the conventional wisdom, the receiving country may in this case gain from the incremental inflow of … capital, as this diverts tax revenues from the rest of the world. In the case of perfect capital mobility, this possibility …