In a classic model of tax competition, we show that the level of public good provision and taxation in a decentralized equilibrium can be efficient or inefficient with either too much, or too little public good provision. The key is whether there exists a unilateral incentive to deviate from the...

We show that, in competition between a developed country and a developing country over environmental standards and taxes, the developing country may have a 'second- mover advantage.' In our model, firms do not unanimously prefer lower environmental- standard levels. We introduce this feature to...

We show that, in competition between a developed country and a developing country over environmental standards and taxes, the developing country may have a 'second-mover advantage.' In our model, firms do not unanimously prefer lower environmental-standard levels. We introduce this feature to an...

We show that, in competition between a developed country and a developing country over standards and taxes, the developing country may have a 'second mover advantage.' A key feature of standards is that, unlike public goods as usually defined, all firms do not unanimously prefer higher standard...

We show that, in a setting where tax competition promotes efficiency, variation in the extent to which firms can use public goods to reduce costs brings about a reduction in the intensity of tax competition. This in turn brings about a loss of efficiency. In this environment, a `minimum tax'...

In an international trading economy where countries set tariffs strategically, modeled using a Cobb-Douglas example, this paper studies the relationship between the structure and the performance of the world market. Using new results from monotone comparative statics in a Shapley-Shubik market...

This paper shows how the institutional rules imposed on its signatories by the GATT created a strategic incentive for countries to liberalize gradually. Trade liberalization must be gradual, and free trade can never be achieved, if punishment for deviation from an agreement is limited to a...

This paper argues that, because governments are able to relax tax competition through public good differentiation, traditionally high-tax countries have continued to set taxes at a relatively high rate even as markets have become more integrated. The key assumption is that there is variation in...

This paper identifies a new terms-of-trade externality that is exercised through tariff setting. A North-South model of international trade is introduced in which the number of countries in each region can be varied. As the number of countries in one region is increased, each government there...

This paper presents a North-South model of international trade in which (i) there is a relatively small number of countries in the North and (ii) the North is relatively abundant in capital while the South is relatively abundant in labor. Using new methods in monotone comparative statics, the...