Corporate taxation and the impact of governance, political and economic factors
(2010) Annual Congress of the International Institute of Public Finance — Location: University of Uppsala, Sweden (23.August.2010)
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- Authors
- Abstract
- In this paper we investigate how, next to traditional economic factors, governance and political arguments may contribute to the determination of the corporate income tax rates. Therefore we .rst extend a standard model of tax competition in order to introduce those new arguments; we nest that model in the theory of lobbying. Then we propose an empiri-cal test of that extension using two international data sets and we show that good governance reduces the rates; parliamentary system, especially plurality election, and religious or nationalist executives, push rates up-ward. Regarding traditional economic factors, economic openness has a negative effect on rates and market size has a positive one; though not robust, interaction among neighbors plays a role. JEL: H73, H70. Keywords: Taxation and political institutions, tax competition, lobbying, governance.
- Affiliations
Louvain School of Management Accounting & Finance FUCaM Sciences de gestion Roral Military Academy and FUCaM Economics
Citations
Gérard, M., & Ruiz, F. (2010). Corporate taxation and the impact of governance, political and economic factors. Annual Congress of the International Institute of Public Finance, University of Uppsala, Sweden. https://hdl.handle.net/2078.5/250392