The primary task of this paper is to test the interactive relations between tax rates at municipality level. We include 96 municipalities between the years 2006 to 2013.   The relations are estimated by panel data instrumental variable estimation method with fixed effect for overcoming the possible specific error of simultaneity. In addition, we choose a set of control variables to strength our analysis. The main findings of this study suggest, one percent tax cut in the neighboring municipality leads to a 0,62 percent decrease in the tax in the home municipality ceteris paribus. This result is in line with theory and is similar to findings in previous studies such as Edmark and Åhgren (2008).

No Brasil, o ponto de vista de que a competição tributária (sempre retratada como "guerra fiscal") é algo conflituoso faz com que seja difundida uma visão negativa sobre um fenômeno que nem sempre é visto como tal na literatura econômica internacional. Muitos economistas veem essa competição como algo que, sendo capaz de coibir o comportamento rent-seeking por parte dos governantes, seria benéfico para a sociedade. Com base nessa ideia, usando o modelo de Eggert e Sorensen (2008), foi testado se variáveis proxy relativas à intensidade da competição tributária e ao comportamento rent-seeking de políticos no poder eram correlacionadas. Usou-se dados dos 26 estados brasileiros e do Distrito Federal para os anos de 2001 a 2009. Os resultados mostraram que, embora essas variáveis proxy não fossem correlacionadas para os níveis de escolaridade mais baixos, no nível mais alto, havia correlação entre essas duas variáveis, embora ela fosse positiva, o que rejeitava a hipótese de que uma maior competição tributária seria capaz de diminuir o comportamento rent-seeking dos políticos. / In Brazil, the point of view that tax competition (commonly referred to as a “fiscal war”) is something conflictive spreads a negative perspective on a phenomenon that is not always seen as such in the international economic literature. Many economists see this competition as something that, in being able to reduce rent-seeking behavior by politicians, would be beneficial to society. Stemming from this idea, and using the model from Eggert and Sorensen (2008), it was tested if proxy variables relating to the intensity of tax competition and to the rent-seeking behavior of politicians in office were correlated. Data from all the 26 Brazilian states and also Distrito Federal, from 2001 to 2009, were used. The results showed that, although the proxy variables were not correlated for the less skilled groups of workers considered, at the high skilled group, there was correlation between the two variables, but it was positive, which rejected the hypothesis that a more intense tax competition would be able to repress rent-seeking behavior by politicians.

No Brasil, o ponto de vista de que a competição tributária (sempre retratada como "guerra fiscal") é algo conflituoso faz com que seja difundida uma visão negativa sobre um fenômeno que nem sempre é visto como tal na literatura econômica internacional. Muitos economistas veem essa competição como algo que, sendo capaz de coibir o comportamento rent-seeking por parte dos governantes, seria benéfico para a sociedade. Com base nessa ideia, usando o modelo de Eggert e Sorensen (2008), foi testado se variáveis proxy relativas à intensidade da competição tributária e ao comportamento rent-seeking de políticos no poder eram correlacionadas. Usou-se dados dos 26 estados brasileiros e do Distrito Federal para os anos de 2001 a 2009. Os resultados mostraram que, embora essas variáveis proxy não fossem correlacionadas para os níveis de escolaridade mais baixos, no nível mais alto, havia correlação entre essas duas variáveis, embora ela fosse positiva, o que rejeitava a hipótese de que uma maior competição tributária seria capaz de diminuir o comportamento rent-seeking dos políticos. / In Brazil, the point of view that tax competition (commonly referred to as a “fiscal war”) is something conflictive spreads a negative perspective on a phenomenon that is not always seen as such in the international economic literature. Many economists see this competition as something that, in being able to reduce rent-seeking behavior by politicians, would be beneficial to society. Stemming from this idea, and using the model from Eggert and Sorensen (2008), it was tested if proxy variables relating to the intensity of tax competition and to the rent-seeking behavior of politicians in office were correlated. Data from all the 26 Brazilian states and also Distrito Federal, from 2001 to 2009, were used. The results showed that, although the proxy variables were not correlated for the less skilled groups of workers considered, at the high skilled group, there was correlation between the two variables, but it was positive, which rejected the hypothesis that a more intense tax competition would be able to repress rent-seeking behavior by politicians.

This paper provides a non-technical overview of NEG models dealing with policy issues. Considered policy measures include alternative categories of public expenditure, international tax competition, unilateral actions of protection/liberalisation, and trade agreements. The implications of public intervention in two-region NEG models are discussed by unfolding the impact of policy measures on agglomeration/dispersion forces. Results are described in contrast with those obtained in standard non-NEG theoretical models. The high degree of abstraction limits the applicability of NEG models to real world policy issues. We discuss in some detail two extensions of NEG models to reduce this applicability gap: the cases of multi-regional frameworks and firm heterogeneity.

Evolutionary stability is a necessary condition for imitative dynamics of policy learning and innovation to come to a rest. We apply this concept to profit tax competition in a regime where a common and consolidated profit tax base for multi-jurisdictional firms is divided among governments by means of formulary apportionment. In evolutionary play, governments exhibit aggregate-taking behavior: when comparing their performance with others, they ignore their impact on the consolidated tax base. Consequently, evolutionarily stable tax rates are less efficient than tax rates in best-response tax competition. / Series: WU International Taxation Research Paper Series

This dissertation investigates whether consumers’ cross-border shopping due to interstate commodity tax differentials influence counties’ economic activity and states’ strategic competition in multiple tax policies. First, I examine how own and the nearest neighboring states’ commodity tax rates affect counties’ retail activity. Particularly, in contrast to many previous studies, I examine whether the distance to the state border influences the responsiveness of counties’ retail activity to sales and excise taxes of own and the nearest neighboring states. Since the costs of avoiding state commodity taxes are presumably lower along borders, the impacts of state commodity taxes on retail activity may be different for counties closer and further away from the state border. Considering retail establishments and employment of industries that are most likely to be affected by consumers’ cross-border shopping activity, I find that that the impacts of domestic and the nearest neighboring states’ sales and excise tax rates on counties’ retail establishments and employment depend on the distance to the state border. However, contrary to what would be expected, the impacts tend not to be very robust. Second, I investigate whether consumers’ cross-border shopping to low commodity taxed states influence state governments to engage in strategic competition in multiple tax policies. Previous works on fiscal competition document that state governments engage in commodity tax competition to gain cross-border shoppers. Specifically, the empirical research find that changes in neighboring states’ one commodity tax rate influence changes in a home state’s same commodity tax rates. However, these studies do not address whether changes in neighboring states’ one commodity tax rate also induce the home state to adjust other taxes, either other commodity taxes or possible income taxes. Using a panel of the United States’ state-level data for the period 1977−2002, I estimate the reaction functions not for a single tax rate but multiple rates. In this framework, I find that states react to neighbors’ lower tax rates on one tax base by changing rates on either the same tax base or/and other tax bases, thereby suggesting that states engage in strategic competition in multiple tax rates to meet their revenue goals.

This paper provides a non-technical overview of NEG models dealing with policy issues. Considered policy measures include alternative categories of public expenditure, international tax competition, unilateral actions of protection/liberalisation, and trade agreements. The implications of public intervention in two-region NEG models are discussed by unfolding the impact of policy measures on agglomeration/dispersion forces. Results are described in contrast with those obtained in standard non-NEG theoretical models. The high degree of abstraction limits the applicability of NEG models to real world policy issues. We discuss in some detail two extensions of NEG models to reduce this applicability gap: the cases of multi-regional frameworks and firm heterogeneity.

This master thesis deals with the rising issue telated to tax competition and its consequences. It si observed and analyzed the tax policy in four central-european economies: Czech republic, Austria, Hungary and Slovakia during last 10-12 years. The objective is to find out how much is the policy in particular countries different and which one is the most active in promotion of tax competition. The work focus on statutary corporate income tax rates, implicit rates and the overall tax burden in the observed economies. We come to the conclusion that the tac competition oriented policy is most obvious in Slovakia followed by Czech republic and Hungary. In case of Austria we can see that effect of tax competiton in a small region can not be ignored which leads to undertake several steps in order to remain competiitive.

The diploma thesis examines tax competition between Croatia and its neighbouring countries- Hungary, Slovenia, Bosnia and Herzegovina and Serbia- based on corporate income tax. After first theoretical part focused on tax harmonization, coordination and competition, the paper continues with describing systems of the corporate income tax for each country. Subsequently the practical part follows with analysis of tax competition from corporate tax perspective using time and space comparison. Final conclusion of the thesis is that Croatia, respecting corporate income tax, is highly competitive location in comparison with analyzed neighbouring countries.

This diploma thesis is dealing with tax competition, especially in the European Union. There are explained concepts of tax harmonization and coordination, harmful tax competition and a tendency of the European Union to harmonization in corporate tax area. Statutory tax rates and implicit tax rates, which are better for measurement of real taxation, are used for analysis of tax competition in corporate tax area. Tax rates are compared between old and new members of the European Union to find out whether there is tax competitive environment in the European Union. In this diploma thesis one analysis of the European Commission about effective tax rates is also described. The aim of this thesis is verifying the hypothesis, whether is the tax competition in the corporate tax area in the European Union successful -- whether better conditions of taxation in new member states cause higher tax bases. In this diploma thesis there are also some notes about tax revenues.