Tax Competition and the Determination of the Quality of Public Goods-Reference-Cited by-同舟云学术

Tax Competition and the Determination of the Quality of Public Goods

Published:2014-03-18 Issue:1 Volume:8 Page:
ISSN:1864-6042
Container-title:Economics
language:en
Short-container-title:

Author:

Abdessalam A.H. Ould¹,Kamwa Eric²

Affiliation:

1. University of Caen Lower Normandy , Center for Research in Economics and Management (UMR CNRS 6211), 19 Rue Claude Bloch 14032 Caen, Cedex, France, and Audencia Business School of Nantes , France

2. University of Caen Lower Normandy , France

Abstract

Abstract In this paper, the author analyzes the behavior of local governments in capital taxation when the financial choices in terms of the quality of public goods are made done by a central planner. More specifically, he asks the question of whether a local government has an interest in taxing the mobile factor in addition to the tax on representative households. Through a comparison of social welfare given the strategies chosen by local governments, the author shows that whatever the quality and cost of public goods, a local government always has an interest in taxing the mobile factor. This leads to a Nash equilibrium in the dominant strategy in their model.

Publisher

Walter de Gruyter GmbH

Subject

General Economics, Econometrics and Finance

Link

https://www.degruyter.com/document/doi/10.5018/economics-ejournal.ja.2014-12/pdf

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