Logo
Munich Personal RePEc Archive

Global Corporate Income Tax Competition, Knowledge Spillover, and Growth

Maebayashi, Noritaka and Morimoto, Keiichi (2022): Global Corporate Income Tax Competition, Knowledge Spillover, and Growth.

[thumbnail of Maeb_Morimoto_01_20220408.pdf]
Preview
PDF
Maeb_Morimoto_01_20220408.pdf

Download (303kB) | Preview

Abstract

In a two-country model of endogenous growth with international knowledge spillover, corporate income tax competition reproduces the second-best allocation attained by tax harmonization, despite complex externalities. This stems from the positive spillover effect across the border and free trading by Ricardian households in the global financial market. However, such a neutrality result does not hold in the extended model, which includes non-Ricardian households. The equilibrium tax rate under the corporate income tax competition can be excessively high or low, depending on the elasticity of the spillover effect to the share of the firms’ locations.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.