Should (or when should) separate governments, including sub-units in a federal system, be encouraged to engage in tax competition rather than harmonizing their tax systems? The question is akin to asking when government should be used to solve collective action problems through coercion, and...

Should (or when should) separate governments, including sub-units in a federal system, be encouraged to engage in tax competition rather than harmonizing their tax systems? The question is akin to asking when government should be used to solve collective action problems through coercion, and...

Researchers in a number of fields have explored the question of why people voluntarily comply with the tax laws. The resulting scholarship suggests that a number of factors influence that decision, but the precise role of, and interaction between, those factors continue to be subjects of debate....

The use of tax policy to address environmental destruction is entering a new phase in Canadian history with the adoption of a Pan-Canadian Framework on Clean Growth and Climate Change, which features a federal carbon tax regime. This Framework is designed as a backstop to existing sub-national...

This paper studies policy competition for a foreign-owned multiproduct monopolist firm producing two products that are horizontally differentiated between two countries of different size. We show that the equilibrium outcome of FDI competition is determined by the interaction between the market...

Rent-sharing between firm owners and workers is a robust empirical finding. If workers bargain with firms, information on the actual surplus is essential. When the firm can use profit shifting to create private information on the surplus, it can thereby reduce its wage bill. We study how rent...

The discontinuous tax treatment of sales at borders creates incentives for individuals to cross-border shop. This paper addresses whether it is optimal for a state composed of multiple regions to levy differentiated commodity tax rates across the regions. In a model where states maximize social...

In this study, we estimate the impacts of differences in international tax rates on the probability of choosing a location for an affiliate of a multinational firm. In particular, we distinguish between the tax sensitivity of Greenfield and M&A investments. Based on a novel firm-level dataset on...

We investigate competition for FDI within a region when a foreign multinational firm can profitably exploit differences in statutory corporate tax rates by shifting taxable profits to lower-tax jurisdictions. In such framework we show that targeted tax competition may lead to higher welfare for...

This paper analyzes tax competition when welfare maximizing jurisdictions levy source-based corporate taxes and multinational enterprises choose tax-efficient capital-to-debt ratios. Under separate accounting, multinationals shift debt from low-tax to high-tax countries. The Nash equilibrium of...