A simulation model consisting of a representative consumer for each Scandinavian country is constructed and calibrated, in which consumers consume two goods: spirits and 'other goods'. Spirits is exposed to cross-border shopping, and the countries engage in tax competition. The equilibrium tax...

A simulation model consisting of a representative consumer for each Scandinavian country is constructed and calibrated, in which consumers consume two goods: spirits and 'other goods'. Spirits is exposed to cross-border shopping, and the countries engage in tax competition. The equilibrium tax...

The purpose of this paper is to consider an economy in which incorporates cross-border shopping and where the different levels of government worry about the well-being of their citizens. We assume a federalist economy with a central government and two regions with specific characteristics. Two...