re examination of uniform commodity taxes under a non linear income tax system and its implication for production efficiency abstract this paper shows that the result of uniform commodity tax under nonlinear income taxation by atkinson and stiglitz 1976 no longer holds if the production side of an economy is taken into the consideration in particular imposing a non uniform commodity tax can pareto improve welfare even under nonlinear income taxation in addition the paper shows that if the government uses a nonlinear income tax system for income redistribution then the introduction of distortions in the public sector can pareto improve welfare contrary to the results in diamond and mirrlees 1971

taxation and international migration of superstars evidence from the european football market we analyze the effects of top tax rates on international migration of football players in 14 european countries since 1985 both country case studies and multinomial regressions show evidence of strong mobility responses to tax rates with an elasticity of the number of foreign domestic players to the net of tax rate around one around 0 15 we also find evidence of sorting effects low taxes attract highability players who displace low ability players and displacement effects low taxes on foreigners displace domestic players those results can be rationalized in a simple model of migration and taxation with rigid labor demand jel f22 h24 h31 j44 j61 l83

de gustibus non est taxandum heterogeneity in preferences and optimal redistribution abstract the prominent but unproven intuition that preference heterogeneity reduces redistribution in a standard optimal tax model is shown to hold under the plausible condition that the distribution of preferences for consumption relative to leisure rises in terms of first order stochastic dominance with income given familiar functional form assumptions on utility and the distributions of ability and preferences a simple statistic for the effect of preference heterogeneity on marginal tax rates is derived numerical simulations and suggestive empirical evidence demonstrate the link between this potentially measurable statistic and the quantitative implications of preference heterogeneity for policy

taxation of outbound direct investment economic principles and tax policy considerations this paper reviews economic principles for optimality of the taxation of international profit from both a global and national perspective it argues that for traditional systems based on the residence of the investor or the source of the income nothing less than full harmonisation across countries can achieve global optimality the conditions for national optimality are more difficult to identify but are most likely to imply source based taxation however source based taxation requires an allocation of the profits of multinational companies to individual jurisdictions this is not only very difficult in practice but in some cases is without any conceptual foundation the taxation of interest income on a residence basis is also hard to justify if the aim of the tax system is to tax only the income arising from economic activity in a given country

foreign ownership and corporate income taxation an empirical evaluation abstract foreign ownership allows countries to effectively export part of their corporate tax burden hence countries with high foreign ownership are expected to impose relatively high corporate taxes the findings of this paper suggest that there indeed is an economically significant positive relationship between foreign ownership and tax burdens in europe already significant foreign ownership levels in europe offer an explanation for the absence of a race to the bottom in corporate tax levels

decentralization and intra country transfers in the great recession the case of the european union empirical evidence is found supporting the assignment of the redistribution function to the central government viewing the great recession or recessions in general as a shock it is found that a

international effects of tax reforms in an open economy with international capital flows there is an equivalence relation between income tax consumption tax international borrowing tax and an external interest earning tax this paper analyzes tax reform involving shifts between income and consumption taxes in this setting it is shown that the real effects of such revenue neutral tax reform depend critically on the country s current account position and the nature of the reform in particular whether the world interest rate rises or falls as a consequence of a budget deficit depends on the tax system in force the analysis provides a clear rationale for the international coordination of tax policies copyright 1989 by royal economic society

co evolution entropy as a new index to explore power system transition a case study of china s electricity domain abstract power systems are bound to experience a long transition process which involves not only changes in technology but also changes in user practices regulations industrial networks infrastructures and cultures there are conflicts among these factors on account of the mutual uncoordinated changes which would hinder the development of power systems therefore keeping permanent coordination of numerous factors is a great challenge for the power system evolution current evaluation methods of power system evolution do not pay sufficient attention to the co evolution of factors particularly for technology society finance and policy as well as insight from innovation studies and the sociology of technology hence we propose a new index co evolution entropy which can indicate the positive negative entropy interaction coordinating system evolution then based on socio technical system we identify 14 factors participating in the evolution of power system from three layers landscape regime and niche finally we apply this index to china s electricity domain for identifying the evolution obstacles of non coordinates and propose a strategy to improve the system s co evolution results show that 1 the change in co evolution entropy from different layers has different characteristics for example the landscape mainly possesses negative entropy but the regime holds positive entropy 2 the power system s co evolution entropy changes from 0 043 to 0 154 and reaches the maximum 0 054 in 2000s which indicates that china s power system begins the coordinated development through a run in 3 the co evolution of the power system is hindered by too much policy intervention however technology innovation and electricity market opening could enhance its co evolution we also derive strategic policy recommendations from the analysis result and present a co evolution concept to improve the socio technical system

baumol s disease and dematerialization of the economy this paper argues that there is reason to be skeptical about the idea that the transition to a service economy will bring about dematerialization of production and consequent environmental improvement this is because the shift to a service economy is an illusion in terms of real production but is instead generated by the fall in the price of manufacturing goods relative to services which is in turn caused by more rapid productivity growth in manufacturing than in services this argument relies on the insights baumol provided on the nature of the service economy and uses swedish long term data on relative sectoral development as an empirical illustration on the other hand the paper argues that there is reason to be cautiously optimistic that structural change may bring about a greening of growth namely the changes in growth patterns sometimes labeled the third industrial revolution which is connected to the emergence of microelectronics swedish co2 emissions show a decline after 1970 which is mainly explained by a politically driven change in the mix of energy carriers but is also related to the stabilization of energy consumption this energy stabilization was caused by slow growth of the economy in conjunction with substantial declines in energy intensity within industrial sectors and an absence of relative growth of the heavy sectors a growth that had marked the economy between 1870 and 1970 microelectronics have contributed to permanently transforming the swedish industrial sector in a lighter direction reducing energy losses in heavy industries and stabilizing household energy consumption so it appears as if there may be some environmental gains from this development that was initiated in the 1970s but not from relatively more production in the service sector

demand pull technology push and government led incentives for non incremental technical change abstract rising expectations about future demand for new technologies increase the incentives for investments in innovation by enlarging payoffs to successful innovations how well does this notion of demand pull apply to non incremental technological change when demand is largely attributable to actions by governments in this case inventors of the most important inventions did not respond positively to strong demand pull policies filing of highly cited patents declined precipitously just as demand for wind power created a multi billion dollar market three explanations for this apparent inconsistency with the demand pull hypothesis played a role 1 the rapid convergence on a single dominant design limited the market opportunity for non incremental technical improvements 2 even though the policies implemented were stringent enough to stimulate demand uncertainty in their longevity dampened the incentives for inventions that were likely to take several years to pay off and 3 alternative explanations such as declining r d funding and weakening presidential engagement on energy appear to have been important

innovation complementarity and environmental productivity effects reality or delusion evidence from the eu abstract innovation is a key element behind the achievement of desired environmental and economic performances regarding co2 mitigation strategies would require cuts in emissions of around 80 90 with respect to 1990 by 2050 in the eu we investigate whether complementarity namely integration between the adoption of environmental innovation measures and other technological and organizational innovations is a factor that has supported reduction in co2 emissions per value added that is environmental productivity we merge new eu innovation and wiod data to assess the innovation effects on sector co2 performances at a wide eu level we find that jointly adopting different innovations is not a widespread factor behind increases in environmental productivity nevertheless even though complementarity is not a low hanging fruit a case where innovation complementarity arises is for manufacturing sectors that integrate eco innovations with product innovations one example of this integrated action is a strategy that pursues energy efficiency with product value enhancement we believe that the lack of integrated innovation adoption behind environmental productivity performance is a signal of the current weaknesses economies face in tackling climate change and green economy challenges incremental rather than more radical strategies have predominated so far the latter have been confined to industrial niches in terms of the number of involved firms this is probably insufficient when we look at long term economic and environmental goals

the incidence of income taxes on high earners in canada this article explores the brain drain explanation for the concentration of incomes in canada during the past 30 years namely that high skilled canadians make use of high salaries on offer in the united states to extract higher salaries at home if this is the case then for a given level of us salaries the threat to accept outside offers should be more credible when the canadian dollar is depreciating against the us dollar and weaker when the canadian dollar is appreciating the data are broadly consistent with this claim income concentration worsened during the depreciations of the 1980s and 1990s and eased when the canadian dollar began to appreciate in value the article develops a simple two parameter model based on the propositions that high earners in canada can use us salaries to bargain for higher salaries and that canadian high earners can shelter part of their income from personal income taxes it also offers some preliminary evidence about the parameter values consistent with available data the results suggest that higher top marginal personal income tax rates may potentially accentuate top end after tax income inequality if high earners are able to use their bargaining power to extract pay increases to offset higher tax rates then the burden of increased personal income taxes will be deflected elsewhere and may even have the perverse effect of making the after tax income distribution more unequal than it was before l incidence des impots sur le revenu des hauts salaries au canada cet article examine l hypothese des produits de base produits de base produits de base produits de base produits de base fuites des cerveaux comme explication pour la concentration des revenus au canada pendant les dernieres decennees c est a dire que les canadiens hautement qualifies se servent des salaires offerts aux etats unis pour negocier des salaires plus eleves au canada si tel est le cas la menace d emigrer aux etats unis est plus credible lorsque le dollar canadien deprecie contre le dollar americain et elle est moins credible pendant une appreciation les grandes lignes des variations des donnees vont dans le sens de cette conjecture la concentration des revenus a accru pendant les depreciations des annees 1980 et 1990 et cette tendance a renverse la direction suite a l appreciation du dollar canadien l article developpe un modele a deux parametres base sur les propositions que les hauts salaries au canada peuvent utiliser les salaires aux etats unis afin de negocier des salaires plus eleves et que les hauts salaries se servent de la planification fiscale afin de mettre une partie de leurs revenus a l abri des impots des estimations preliminaires pour les parametres sont presentees les resultats suggerent qu une augmentation du taux marginal d imposition pourrait meme accentuer l inegalite des revenus apres impots si les hauts salaries sont capables de negocier des salaires plus eleves face aux augmentations des taux d imposition le fardeau du nouvel impot serait refile ailleurs la distribution des revenus nets pourrait meme devenir encore plus inegale

can state taxes redistribute income abstract the evidence presented in this paper supports the basic theoretical presumption that state and local governments cannot redistribute income since individuals can avoid unfavorable taxes by migrating to jurisdictions that offer more favorable tax conditions a relatively unfavorable tax will cause gross wages to adjust until the resulting net wage is equal to that available elsewhere the current empirical findings go beyond confirming this long run tendency and show that gross wages adjust rapidly to the changing tax environment thus states cannot redistribute income for a period of even a few years the adjustment of gross wages to tax rates implies that a more progressive tax system raises the cost to firms of hiring more highly skilled employees and reduces the cost of lower skilled labor a more progressive tax thus induces firms to hire fewer high skilled employees and to hire more low skilled employees since state taxes cannot alter net wages there can be no trade off at the state level between distribution goals and economic efficiency shifts in state tax progressivity by altering the structure of employment in the state and distorting the mix of labor inputs used by firms in the state create deadweight efficiency losses without achieving any net redistribution

linking namea and input output for consumption vs production perspective analyses evidence on emission efficiency and aggregation biases using the italian and spanish environmental accounts we integrate input output and namea tables for spain and italy in 1995 2000 and 2005 in order to address the hot policy issue of sustainable consumption and production a comparison of production and consumption perspectives may have relevant policy implications we deal with the domestic technology assumption and primarily the aggregation bias that may result when calculating indirect emission using different sector aggregations in the analyses e g 16 30 50 extended input output analysis provides analyses of the emissions embodied in domestic consumption and domestic production by considering the structure of intermediate inputs and environmental efficiency in each production sector our empirical findings show that different sectoral aggregation significantly biases the amount of emissions for the consumption perspective though differently in the two countries italy surprisingly show consumption production ratios around or lower than one but in line with some major work at eu level our results thus suggest that special attention must be paid when interpreting the ee ioa of country estimated amounts of embodied emissions both in domestic final demand and those directly associated with the production sectors when the sectoral aggregation level has a low definition as considered in some recent similar studies

lessons from the kibbutz on the equality incentives trade off the first kibbutz was established southwest of the sea of galilee in 1910 but the vast majority of kibbutzim were established in the 1930s and 1940s shortly before the creation of the state of israel in 1948 founders aimed to create a new human being who cared about the group more than about himself a homo sociologicus who would challenge the selfish homo economicus this idealistic view can explain many of the key features of kibbutzim equal sharing in the distribution of income no private property a noncash economy communal dining halls where members ate their meals together high provision of local public goods for use by kibbutz members separate communal residences for children outside their parents homes which were supposed to free women from their traditional role in society and allow them to be treated equally with men collective education to instill socialist and zionist values communal production whereby kibbutz members worked inside their kibbutzim in agriculture or in one of the kibbutz plants and no use of hired labor from outside kibbutzim because hiring labor was considered exploitation under the reigning socialist ideology to an economist steeped in thinking about incentives that self interested individuals face there are three reasons why an equal sharing arrangement of this sort seems unlikely to last first high ability members have an incentive to exit equal sharing arrangements to earn a wage premium so called brain drain second low ability individuals have an incentive to enter equal sharing arrangements so that they can be subsidized by more able individuals so called adverse selection third in context of equal sharing shirking and free riding are likely to be prevalent however kibbutzim have survived successfully for the past century and currently consist of 120 000 members living in 268 kibbutzim in a number of ways the kibbutzim offer an exceptional environment to examine the potential trade off between equality and incentives

the rise of the states u s fiscal decentralization in the postwar period article i nfo article history one of the most dramatic changes in the fiscal federalism landscape during the postwar period has been the rapid growth in state budgets which almost tripled as a share of gdp and doubled as a share of government spending between 1952 and 2006 we argue that the greater role of states cannot be easily explained by changes in tiebout forces of fiscal competition such as mobility and voting patterns and are not accounted for by demographic or income trends rather we demonstrate that much of the growth in state budgets has been driven by changes in intergovernmental interactions restricted federal grants to states have increased and federal policy and legal constraints have also mandated or heavily incentivized state own source spending particularly in the areas of education health and public welfare these outside pressures moderate the forces of fiscal competition and must be taken into account when assessing the implications of observed revenue and spending patterns

the importance of local fiscal conditions in analyzing local labor markets a new test of the compensating wage differential model is proposed the logic behind roback s model which shows how differences in nonproduced amenities may be reflected in intercity wage differentials is extended to the case of differences in local fiscal conditions represented by tax rates and publicly produced services results show that differences in local tax rates and services provisions do generate compensating wage differentials across cities the effects of a particularly large set of taxes and effective services output measures are examined differences in local fiscal conditions are shown to play important roles in explaining the variance in intermetropolitan wages

an analysis of the corporate income tax policy of less developed countries unlike developed countries corporate tax rather than personal tax revenues are the greater source of public finance for less developed countries ldcs this paper analyses the corporate income tax policy for a large panel of ldcs over the period 1980 2006 the analysis shows that although the corporate tax rate has been decreasing in ldcs corporate tax revenues have been increasing as a percentage of total tax revenues and gdp contrary to standard tax competition theory there is also strong evidence that corporate income taxes in ldcs are increasing in the country s openness as measured by capital mobility the analysis also shows that the corporate tax rate is increasing in the personal tax rate as income shifting theory predicts however this has not translated into increased corporate tax revenues of equal interest is the lack of evidence of a relationship between the ldc s government revenue needs and its corporate tax rate

what drives eco innovators a critical review of the empirical literature based on econometric methods abstract the aim of this paper is to provide a critical review of the literature on the econometric analyses of firm level determinants to eco innovation the review reveals some gaps in knowledge first an integrated theoretical framework which merges the insights from different approaches is missing second the influence of some variables is still unsettled demand pull and cost savings whereas others have hardly been included in previous analyses internal and international factors third studies on the drivers to eco innovation versus general innovation are relatively scarce with respect to those on the drivers to eco innovation in general fourth analyses of the relevance of different determinants to eco innovation for distinct eco innovator and eco innovation types have largely been missing fifth studies on middle income and developing countries are still scarce sixth the econometric analyses have relied on microeconometric methods based on cross section data mostly logit and probit models whereas the use of panel data is virtually absent seventh detailed econometric analyses on the distinct drivers and barriers to eco innovation in different sectors and regions have not been performed so far finally whether the position of the firm in the value chain and the market structure influence the propensity to eco innovate are largely unexplored topics

capital income and profit taxation with foreign ownership of firms abstract this paper establishes optimal rules for capital income and profits taxation in the open economy with or without foreign ownership of domestic firms we show that if there are constraints on the feasibility of profits taxation both saving and investment taxes generally enter the optimal tax package if instead profits can be fully taxed then source based investment taxes vanish if domestic firms are in part owned by foreigners then source based investment taxes can be used to shift income away from these to domestic citizens and they may even be used to finance lump sum transfers to domestic residents

capital taxation and production efficiency in an open economy we attempt to clarify the role of the production efficiency theorem in international capital taxation it is shown that a direct open economy analogue to the production efficiency theorem arises not in the small country case but in the more general setting of tax competition between a finite number of identical jurisdictions

stock index futures implications for international capital taxation abstract this paper develops a model of corporate capital structure and investor portfolio choice in an international setting the model s key feature is the stock index futures contract investors and companies specialize in securities based on tax and currency appreciation rates despite this specialization investors achieve complete diversification through futures positions nations should tax interest and capital gains equally and should not tax corporate income this contrasts with the result when futures do not exist in which foreigners desire for diversification provides countries with an incentive to use tax policy to reduce foreign ownership of domestic equity to acquire monopoly rents

the deindustrialisation tertiarisation hypothesis reconsidered a subsystem application to the oecd7 the diffusion of outsourcing both national and international and vertical fdis among manufacturing firms along with the higher integra tion of business services in manufacturing has recently led to question the empirical evidence supporting the deindustrialisation tertiarisation dt hypothesis rather than a real phenomenon it has been argued dt would be an apparent one mainly due to the reorganization of production across national and sectoral boundaries the empirical studies that have dealt with the topic so far have not been able to effectively rule out such possibility because of two main limitations the sectoral level of the analysis and or the national focus in order to overcome them the paper carries out an appreciative investigation of the actual extent of the dt occurred in the oecd area over the 80s and the 90s by moving from a sector to a subsystem perspective thus retaining both direct and indirect relations and by referring to a pseudo world of 7 oecd countries thus taking into account the global dimension of the phenomenon the results strongly support the dt hypothesis although the weight of business sector services in the manufacturing subsystem increased acting as a counterbalancing tendency to the manufacturing decline subsystem shares significantly decreased thus confirming dt as a more fundamental trend of modern economies

taxes institutions and foreign diversification opportunities abstract investors can access foreign diversification opportunities through either foreign portfolio investment fpi or foreign direct investment fdi the worldwide tax regime employed by the us potentially distorts this choice by penalizing fdi relative to fpi in low tax countries on the other hand weak investor protections in foreign countries may increase the value of control creating an incentive to use fdi rather than fpi by combining data on us outbound fpi and fdi this paper analyzes whether the composition of us outbound capital flows reflects these incentives to bypass home and host country institutional regimes the results suggest that the residual tax on us multinational firms foreign earnings skews the composition of outbound capital flows a 10 decrease in a foreign country s corporate tax rate increases us investors equity fpi holdings by approximately 10 controlling for effects on fdi investor protections also seem to shape portfolio choices though these results are not robust when only within country variation is employed

taxation and the long run allocation of labor theory and danish evidence abstract inspired by hayek 1945 we study the distortionary effects of taxation on labor mobility and the long run allocation of labor across different profitable opportunities these effects are not well detected by the methods applied in the large public finance literature estimating the elasticity of taxable income and quantifying the efficiency loss from taxation our analysis builds on a standard search theoretic framework where workers are continually seeking better paid jobs but are also fired from time to time because of economic development and productivity shocks we incorporate non linear taxation into this setting and estimate the structural parameters of the model using employer employee register based data for the full danish population of workers and workplaces for the years 2004 2006 our results indicate that along the intensive margin the danish taxation generates an overall efficiency loss corresponding to a 12 reduction in total income it is possible to reap 4 5 of this potential efficiency gain by going from a high tax scandinavian system to a level of taxation in line with low tax oecd countries such as the united states the tax responsiveness of labor mobility and allocation corresponds to an elasticity of taxable income with respect to the net of tax rate in the range 0 15 0 35

country characteristics and the incidence of capital income taxation on wages an empirical assessment this paper examines the incidence of corporate income taxes on wages using data from the us bureau of labor statistics for 13 oecd countries within a wage bargaining framework our econometric analysis shows that a substantial share of the corporate tax burden is shifted from capital to labour however the magnitude of this shift is influenced importantly by country characteristics affecting the process of wage determination such as the degree of capital mobility a country s relative influence over the world price of output and trade unions strength

tax induced mobility evidence from a foreigners tax scheme in switzerland abstract we study location choice and residential mobility responses to local income taxes exploiting a special tax regime which applies to foreign employees residing in switzerland the institutional setting used generates a deterministic duration threshold at 5 years of stay in the country at which the local tax rates an individual faces simultaneously change in all municipalities we exploit this exogenous variation by applying a fuzzy regression discontinuity design to merged survey and administrative individual level data a dynamic location choice model allows us to derive testable hypotheses of individuals location choices and mobility decisions our estimated treatment effects provide causal evidence for tax induced residential choices and tax induced intra national mobility

dynamic optimal taxation in small open economies abstract this paper examines the effects of perfect capital mobility on the determination of optimal capital taxation it shows that capital movements do not change dramatically the optimal tax path studied for the closed economy in addition the paper provides a counterexample to the standard belief that the worldwide system is the optimal regime of taxation finally it shows that the rate of taxation of the rest of the world is not fundamental to determine the optimal decision of a small economy

who offers tax based business development incentives abstract many american communities seek to attract or retain businesses with tax abatements tax credits or tax increment financing of infrastructure projects tifs the evidence for 1999 indicates that communities are most likely to offer one or more of these business development incentives if their residents have low incomes if they are located close to state borders and if their states have troubled political cultures ten percent greater median household income is associated with a 3 2 lower probability of offering incentives 10 greater distance from a state border is associated with a 1 0 lower probability of offering incentives and a 10 higher rate at which government officials are convicted of federal corruption crimes is associated with a 1 2 greater probability of offering business incentives tifs are the preferred incentive of communities whose residents have household incomes between 25 000 and 75 000 whereas tifs are much less commonly offered by communities whose residents have household incomes below 25 000 the need to finance tifs out of incremental tax revenues may make it infeasible for many of the poorest of communities to use tifs for local business development

the choice of apportionment factors under formula apportionment thispaperinvestigatesthechoiceofapportionmentfactorsunderacorporatetaxsystemofformulaapportionment in contrast to perceived wisdom we show that the apportionment formula contains both mobile capital and immobile labor factors regardless of whether the formula is determined decentrally by jurisdictions or centrally by a central planner the central planner uses the formula as a corrective instrument to internalize fiscal externalities we calibrate the model to the european union and show that replacing the current system of separate accounting by formula apportionment would substantially increase tax revenue and welfare under both centralized and decentralized formula choices

taxing capital in a large open economy abstract this paper analyzes capital taxation in a dynamic optimizing equilibrium model of a large open economy it is shown that the existence of current account imbalances may yield surprising results for example if a country has a current account deficit the tendency of an increased tax on investment to lower wages is dampened if the deficit is sufficiently large an increased investment tax may actually increase both wages and welfare in the long run a country with a current account surplus may find that temporary investment incentives improve its current account in all but the short run

taxation of asset income in the presence of a world securities market abstract this paper examines a capm model of world security prices in which governments recognize their ability to influence international security prices via their tax treatment of foreign and domestic investors in this model governments have the incentive to set tax rates such that investors tend to specialize in domestic securities and to restrict net capital flows between countries each country does this to increase the utility of domestic residents taking as given the tax policies of other governments but the net outcome is a reduction in world efficiency and likely a reduction in the utility of all investors

environmental innovations and profitability how does it pay to be green an empirical analysis on the german innovation survey much of the empirical literature analysing the relation between environmental innovation and competitiveness has focused on the question whether it pays to be green we differentiate between different types of environmental innovations which will be disentangled in those aiming at reducing the negative externalities and those allowing for efficiency increases and cost savings what we analyze is at first the extent to which these two typologies have impacts on firms profitability with opposite signs and secondly whether the motivations driving the adoption of those innovations make the difference in terms of economic gains we find empirical evidence that both the typology of environmental innovation and the driver of their adoption affect the sign of the relationship between competitiveness and environmental performance the empirical strategy is based on a sample of german firms and makes use of a merge of two waves of the mannheim innovation panel in 2011 and 2009 that allow overcoming some endogeneity issues which may arise in a cross section setting

nonlinear income taxation and matching grants in a federation with decentralized in kind transfers we extend to a fiscal federalism setting the literature on redistributive in kind transfers in the presence of nonlinear income taxation local governments have a cost advantage motivating decentralization of the in kind transfer the cost structure varies across regions and the central government cannot observe which region is which we show that decentralized in kind transfers can in this setting be an even more important instrument for relaxing self selection constraints thus helping redistribution than in single government models we characterize the optimal marginal tax rates and matching grants the grants have a very different structure than the one derived in earlier studies

the sustainable energy concept making sense of norms and co evolution within a large research facility s energy strategy abstract the analysis presents an evolving energy concept and strategy at an energy intensive research facility in order to contribute understanding of how organisations may implement renewable energies and improve energy efficiency whilst also delivering broader socio economic benefits a framework is developed that infuses institutional perspectives with a micro level view it facilitates positioning of strategy against instrumental altruistic and factual relational extremes and analysis of organisational strategy in the face of internal external stakeholder and institutional forces applied to a seven year case this supports understanding of strategy purpose and inputs as they co evolve along a project time line it is found that the energy strategy evolves from a dominantly instrumental but stakeholder driven position towards approaches aligned with deliberate public good provision in areas beyond direct organizational interests and that changes required significant redefinition of the design and operational models developments are explained as largely the result of internal agency and culture building influences from an energy department equipped with concrete management tools and autonomy at the case level the study concludes that the energy concept implementation has sparked a change in energy management at large global research facilities the work also demonstrates that longitudinal multi level institutional analysis can contribute to deeper understanding of strategy development

characterizing the policy mix and its impact on eco innovation a patent analysis of energy efficient technologies abstract this paper provides an empirical investigation of the role played by selected characteristics of the policy mix in inducing innovation in energy efficiency technologies an original dataset covering 23 oecd countries over the period 1990 2010 combines the full set of policies in the energy efficiency domain for the residential sector with data on patents applied over the same period in this specific technological sector the econometric results suggest that when the policy mix is characterised by a more balanced use in demand pull and technology push instruments its positive effects on eco innovation tend to be greater moreover a more comprehensive policy mix is shown to be able to enhance innovation activities for the generation of new energy efficient technologies however the simple addition of an indiscriminate number of simultaneous policy instruments may reduce policy mix effectiveness finally the empirical findings confirm previous evidence on the importance of policy spillover effects and suggest that policy similarity between countries may represent an important aspect to be accounted for in policy mix design

international tax coordination regionalism versus globalism tax competition for mobile capital can undermine the attempts of governments to redistribute income from rich to poor i study whether international tax coordination can alleviate this problem using a general equilibrium model synthesizing recent contributions to the tax competition literature the model highlights the crucial distinction between global tax coordination and regional coordination with high capital mobility between the tax union and the rest of the world the welfare gain from regional capital income tax coordination is only a small fraction of the gain from global coordination even if the tax union is large relative to the world economy

state and local tax competition in a spatial model with sales taxes and residential property taxes abstract this paper presents a theoretical model with a uniformly populated line that is divided into local jurisdictions and or states if one level of government imposes sales and residential property taxes and if the spatial extent of each taxing jurisdiction is positive and finite then in nash equilibrium the sales tax rate is less than residential property tax rate housing consumption is suboptimal and the public good is underprovided in each jurisdiction if a very large state or country is divided into local jurisdictions and if both levels of government choose tax rates endogenously then under some assumptions there is an efficient outcome

the effect of marginal tax rates on taxable income a panel study of the 1986 tax reform act this paper uses a treasury department panel of more than 4 000 taxpayers to estimate the sensitivity of taxable income to changes in tax rates on the basis of a comparison of the tax returns of the same individual taxpayers before and after the 1986 tax reform the analysis emphasizes that the response of taxable income involves much more than a change in the traditional measures of labor supply the evidence shows an elasticity of taxable income with respect to the marginal net of tax rate that is at least one and could be substantially higher the implications for recent tax rate changes are discussed

investigating policy and r d effects on environmental innovation a meta analysis in the last decades a wide research effort has been devoted at the analysis of the determinants of environmental innovation ei whereas agreement seemed to emerge around a cluster of determinants mainly technology push market pull policy push pull and firm specific factors empirical analyses have failed to provide strong confirmation on the relevance of some core variables after a qualitative discussion of this literature we empirically assess it by exploiting meta regression analysis techniques to test the effectiveness of two determinants policy and r d our findings are clear as for the first we show that only certain types of policy have proven to affect ei in particular regulatory stringency as for r d we show that the use of estimation methods is not neutral to the outcome of the primary studies

environmental innovations in services manufacturing services integration and policy transmissions abstract this paper investigates the relevant factors behind the almost unexplored realm of environmental innovation in services using a dataset of 8161 italian service firms specifically we test whether manufacturing services integration matters for environmental innovations in addition taking account for the heterogeneity of the service industries we analyse whether environmental policies for manufacturing transmit induced innovation effects to services our findings show that i the drivers of environmental innovations related to carbon abatement and energy efficiency differ across industries and ii cooperation training environmental management systems and public funding play key roles in these processes the integration of services and manufacturing through push and pull effects and the environmental policy transmission effect from manufacturing to services generally do not seem to have a positive impact on the diffusion of environmental innovations

the innovation effects of environmental policy instruments a typical case of the blind men and the elephant abstract in this paper we examine the innovation effects of environmental policy instruments in four literatures theoretical models on incentives for eco innovation econometric studies based on observed data survey analysis based on stated information and technology case studies the aim of this paper is to critically examine the methods and the results we argue that the case studies literature even when its results are specific and difficult to generalise is a necessary source of empirical evidence about policy impacts and the factors responsible for these impacts pointing to issues that are neglected in the theoretical and econometric literature such as the specifics of the innovation context and policy interaction effects the paper states five synthesised findings and makes a plea for multi method analysis one other important synthesised finding is that the influence of market based instruments on innovation such as emission trading and taxes is far weaker than assumed

individual tax rates and regional tax revenues a cross state analysis abstractindividual tax rates and regional tax revenues a cross state analysis regional studies this paper analyzes the effects of state level personal tax rates on state tax revenue and individual welfare the policy analysis based on a general equilibrium model suggests that tax revenues would benefit from higher wage income sales or property taxes while any increase in dividend income tax would result in a reduction of revenues it is also shown that individuals would suffer from an increase in state level wage income tax dividend tax or sales tax while they would benefit from an increase in property taxes the heterogeneity across states is determined by a taxindex a weighted average of initial taxes at the state level

the limits of equality insights from the israeli kibbutz what limits the capacity of society to redistribute what determines the structure of compensation in organizations striving for income equality this paper addresses these questions by investigating the economic and sociological forces underlying the persistence of the israeli kibbutzim communities based on the principle of income equality to do this i exploit newly assembled data on kibbutzim and a financial crisis in the late 1980s that affected them differentially the main findings are that 1 productive individuals are the most likely to exit and a kibbutz s wealth serves as a lock in device that increases the value of staying 2 higher wealth reduces exit and supports a high degree of income equality and 3 ideology facilitates income equality using a simple model i show that these findings are consistent with a view of the kibbutz as providing optimal insurance when members have the option of leaving more generally these findings contribute to an understanding of how mobility limits redistribution and to an understanding of the determinants of the sharing rule in other types of organizations such as professional partnerships cooperatives and labor managed firms

determinants of environmental innovation new evidence from german panel data sources abstract in most cases empirical analyses of environmental innovations based on firm level data relied on surveys for one point in time these surveys allow for the inclusion of many explanatory variables such as different policy instruments or the influence of pressure groups but it is not possible to address the dynamic character of environmental innovations this paper uses two german panel databases the establishment panel of the institute for employment research iab and the mannheim innovation panel mip of the centre for european economic research zew to explore the determinants of environmental innovations the econometric estimations show that the improvement of the technological capabilities knowledge capital by r d triggers environmental innovations environmental regulation environmental management tools and general organizational changes also encourage environmental innovation a result that has also been postulated by the famous porter hypothesis

a voluntary brain drain tax abstract a major roadblock to the implementation of bhagwati s proposal to allow developing countries to tax skilled emigrants residing in developed countries the brain drain is the administrative problems associated with collecting this tax in the absence of developed country cooperation this paper provides a partial solution to these problems involving the tax treatment of emigrants who return to their countries of origin the tax system is structured so that returning emigrants who previously paid the brain drain tax face lower tax payments than those who evaded the brain drain tax given the expected value of this tax benefit emigrants are willing to pay the brain drain tax in the basic model a source country s optimal tax system includes this brain drain tax and does not distort migration decisions

the insurance value of state tax and transfer programs abstract this paper estimates the total value that individuals derive from their state s tax and transfer program and shows how this value varies by income the paper decomposes this total value into two components redistributive value which is due to predictable changes in income and family circumstances and insurance value which occurs when taxes and transfers compensate for unexpected income shocks our approach is a forward looking one where we examine income and transfers net of taxes over a 10 year period we model state taxes personal income taxes the eitc and sales taxes and state means tested transfers afdc tanf and medicaid schip the calculations are made using the panel study of income dynamics and allow for analysis of the role of changes in tax and transfer programs demographics and income in the value of state net benefits over a period of more than 30 years we find that the redistributive value of state tax and transfer programs sharply declines with income but that the insurance value is increasing in income the resulting total value still declines with income but not nearly as sharply as the redistributive value hence the insurance value mitigates the incentives for mobility that would undo state redistributive spending

capital income taxation in a growing open economy abstract the paper studies the dynamic macroeconomic effects of various forms of capital income taxation in a model of a small open economy with perfect mobility of financial capital and intertemporal optimization on the part of households and firms one of the noteworthy results is that the introduction of a low corporate income tax will not affect consumption in the long run but will simply lead to a replacement of shares by foreign financial assets in household portfolios it is also found that an anticipated investment tax credit can have and that an anticipated dividend tax will have contractionary effects on investment before they are introduced moreover it is shown that while an unanticipated dividend tax is neutral with respect to investment it will have real effects on consumption and net foreign assets in a growing economy

the effect of redistribution on migration evidence from the israeli kibbutz this paper tests a key theoretical prediction of public finance that local redistribution induces sorting of the population so that less productive individuals are located in communities with more redistribution specifically i use a longitudinal data set to test whether and to what extent the intensive redistribution practiced by israeli kibbutzim encourages exit of more productive individuals and entry of less productive ones the findings support the theoretical prediction kibbutz leavers are more skilled than both stayers and other rural migrants and they earn higher wages upon exit than observably similar city natives and other migrants in contrast individuals who earn lower wages in the city are more likely to enter a kibbutz but they are not more likely to move to other rural areas these findings also support borjas hypothesis that migrants self selection depends on the difference in returns to skills between the origin and the destination

the direct incidence of corporate income tax on wages a stylised model is provided to show how the direct effect of corporate income tax on wages can be identified in a bargaining framework using cross company variation in tax liabilities conditional on value added per employee using data on 55 082 companies located in nine european countries over the period 1996 2003 we estimate the long run elasticity of the wage bill with respect to taxation to be 0 093 evaluated at the mean this implies that an exogenous rise of 1 in tax would reduce the wage bill by 49 cents only a weak evidence of a difference for multinational companies is found

taxation and inflation a new explanation for capital flows abstract in a world of mobile capital the current system of taxation implies that the after tax cost of capital and return to saving in each country are negatively correlated with the rate of inflation thus a country s net foreign asset position ought to be negatively correlated with its long run inflation rate the magnitude of these effects is shown to be potentially large for oecd countries cross section and time series regressions confirm that inflation rates are good predictors of net foreign assets the existing distribution of net foreign assets may therefore largely reflect tax distortions

income redistribution in a federal system of governments abstract though the traditional literature in fiscal federalism argues that the federal government should have primary responsibility for income redistribution u s states are in fact actively engaged in redistribution this paper develops a positive model of the respective roles of state and federal governments that can rationalize this observation redistribution by states creates positive horizontal fiscal externalities to other states due to migration but negative vertical fiscal externalities to the national government due to changes in reported taxable income we forecast that states will engage in at least some redistribution though to a lesser degree the greater are mobility relative to taxable income elasticities the federal government can then choose the degree of federal redistribution to assure that the net externalities are zero given such policies we then estimate the welfare weights and migration elasticities for different income groups that would generate the effective net tax schedules observed in the u s the parameter estimates are broadly plausible suggesting that the model can help explain the division of responsibilities for redistribution between state and federal governments

relocation of the rich migration in response to top tax rate changes from spanish reforms a spanish reform granted regions the authority to set income tax rates resulting in substantial tax differentials using administrative data we find that conditional on moving taxes have a signi

an optimal taxation approach to fiscal federalism in a federal system of government each unit of government decides independently how much of each type of public good to provide and what types of taxes and which tax rates to use in funding the public goods in this paper we explore what types of problems can arise from this decentralized form of decision making in particular we describe systematically the types of externalities that one unit of government can create for nonresidents through both its public goods decisions and its taxation decisions the paper also explores briefly what the central government might do to lessen the costs of decentralized decision making

governing the transition of socio technical systems a case study of the development of smart grids in korea abstract this paper examines the motivations processes and outcomes of the development of smart grids in south korea through the perspectives of governance and innovation systems drawing on desktop research and semi structured interviews this paper has two major findings first the development of smart grids in korea has been shaped by various factors including macroeconomic policy the role of the government and experimentation the complex interactions between these factors at the landscape regime and niche levels has impacted on the development of smart grids second while korea s government led approach has its strengths in driving change it has also exposed weaknesses in the country s ability to mobilise the private sector and consumer participation major obstacles including partial electricity market reform and public distrust exist a systemic perspective is needed for policy in order to accommodate the changes required for smart grid development regulatory reforms particularly price setting mechanisms and consumer engagement are priority areas for policy change

hypergrowth in an east asian nic public policy and capital accumulation in singapore abstract singapore has produced the world s highest investment ratios known to account for growth more rapid than in any other less developed country over the past three decades but such high investment needs explanation we trace singapore s public policy of increasing tax concessions and infrastructural spending in effect subsidies to private firms and use an open economy neoclassical model to show how by attracting footloose foreign capital and raising investment levels these policy measures can drive growth the consequent transformation of living standards in singapore suggests in accordance with theory but contrary to most practice that for some less developed countries effectively zero tax on foreign direct investment may be a beneficial strategy yet for both singapore and other would be late industrializers major issues of development strategy arise from the kind of input driven growth analyzed in this article

green technologies and environmental productivity a cross sectoral analysis of direct and indirect effects in italian regions abstract this paper provides empirical investigation of the effects of environmental innovations eis on environmental performances as proxied by the environmental productivity ep measure we focus on sectoral environmental productivity of italian regions by exploiting the regional accounting matrix including environmental accounts regional namea patent applications have been extracted by the patstat database and assigned to the environmental domain by adopting different international classifications of green technologies the latest release of the oecd env tech indicators and the union of this with the previously established wipo green inventory econometric results outline that regions sectors characterized by higher levels of green technologies gts are those facing better environmental performance these positive effects directly stem from the introduction of gt in the same sector as well as from the introduction of gt in vertically related sectors

international tax competition and gains from tax harmonization abstract in a world economy there are two types of distortions which can be caused by capital income taxation in addition to the standard closed economy wedge between the consumer saver marginal intertemporal rate of substitution and the producer investor marginal productivity of capital i international differences in intertemporal marginal rates of substitution implying an inefficient allocation of world savings across countries and ii international differences in the marginal productivity of capital implying an inefficient allocation of world investment across countries the paper focuses on the structure of taxation for countries which are engaged in tax competition and on potential gains from a tax harmonization we show that if the competing countries are sufficiently coordinated with the rest of the world then tax competition leads each country to apply the residence principle of taxation and there are no gains from tax harmonization if however there is not sufficient coordination then tax competition leads to low capital income taxes and the tax burden falls on the internationally immobile factors the outcome is nevertheless still efficient relative to the available constrained set of tax instruments

economic freedom and taxation is there a trade off in the locational competition between countries this paper investigates the relationshipbetween economic freedomand taxation we argue that an economicallyfree environment improvesthe attractiveness of a location which inturn enables governmentsto levy higher business taxes to test thishypothesis empirically weestimate the impact of economic freedom onthe national tax policy where the latter is measured by thecorporate tax revenue related tognp corporate tax ratio we utilize adata set of 46 developed and lessdeveloped countries between 1980 and 1997and find a clear confirmationof our hypothesis further a simulationanalysis reveals that the observedchange in economic freedom has equalizedthe international distributionof corporate tax ratios

trade capital mobility and tax competition this paper examines a system of governments national state or local that finance public expenditures with taxes on mobile capital e g a property tax unlike previous research on tax competition explicit consideration is given to the general equilibrium determination of the prices at which goods are traded between regions the analysis identifies inefficiencies in government behavior that are not apparent in models in which the terms of trade are exogenously given capital taxation is shown to create an inefficient distribution of public good outputs across regions accompanied by an inefficient pattern of trade a model is presented in which the chosen levels of public good outputs differ across regions containing identical residents and production possibilities there is a wasteful diversity of public good supplies

capital income taxation in a world economy a territorial system versus a residence system this paper investigates the effects of a tax reform of conversion from capital income to consumption taxes on capital accumulation in a two country model in the territorial system the tax reform will normally lead to a negative comovement between capital accumulation in two countries while in the residence system it will lead to a positive comovement copyright 1991 by royal economic society

tax competition tax exporting and higher government choice of tax instruments for local governments abstract this paper presents a theoretical model with tax exporting due to external ownership of a fraction of the land in each local jurisdiction there are n local jurisdictions in a metropolitan area n 1 and many metropolitan areas in a world economy the paper examines the usage of business property taxes and source based wage taxes by local jurisdictions first in the presence of and then in the absence of residence based lump sum taxes and how this depends on and n the paper then examines the choice of a world national or state government as to whether to allow local metropolitan or sub metropolitan governments to use business property taxes wage taxes or both assuming that the local governments choose the actual tax rates

do credible domestic institutions promote credible international agreements we examine the relationship between international policy coordination and domestic policy reputation when both are self sustaining we show that domestic policy commitment does not necessarily facilitate international cooperation rather efficient policies may be most easily sustained when governments are unable to pre commit to policy domestically moreover the lack of domestic commitment is more likely to facilitate international cooperation the larger the international spillovers of domestic policies are

compulsive policy making the evolution of the german feed in tariff system for solar photovoltaic power abstract in recent years policy approaches that build upon the notion of innovation systems have enjoyed increasing attention in science technology and innovation policy but while the usefulness of systemic thinking in policy making has been demonstrated in a large number of empirical settings we still lack a detailed understanding of the dynamics at play when policy makers address systemic problems in this paper we show how complex interdependencies and the uncertain nature of technological change shape the process of targeted policy interventions in socio technical systems toward this end we analyzed the evolution of the german feed in tariff fit system for solar photovoltaic power a highly effective and widely copied policy instrument targeted at fostering the diffusion and development of renewable energy technologies we find that the policy has been subject to a considerable amount of changes many of which are the result of policy makers addressing specific system issues and bottlenecks interestingly however often these issues themselves were driven by unforeseen technological developments induced by previous policy interventions we argue that the pattern of policy serving as both a solution to and a driver of technological bottlenecks shows strong similarities with what rosenberg 1969 called compulsive sequences in the development of technical systems by shedding more light on how the characteristics of socio technical systems affect policy interventions our framework represents a first step toward more closely integrating the literature on innovation systems with the work on policy learning

is environmental innovation embedded within high performance organisational changes the role of human resource management and complementarity in green business strategies abstract this paper investigates whether firms joint implementation of organisational innovation and training may foster their adoption of environmental innovation ei and if this correlation falls within porter hypothesis ph framework we study the relationship of complementarity between strategies of high performance work practices hpwp and human resource management hrm when ei adoption is the firms objective using an original dataset on 555 italian industrial firms regarding ei hpwp and hrm coherent with the last cis2006 2008 survey results show that sector specificity matter the only case in which strict complementarity is observed in organisational change concerns co 2 abatement a relatively complex type of ei but this is true only when the sample is restricted to more polluting and regulated sectors this evidence is coherent with the porter hypothesis complementarity related adoption of ei is an element of organisational change in firms that are subject to more stringent environmental regulations nevertheless the fact that strict complementarity is not a diffuse factor behind the adoption of all environmental innovation indeed does not come as a surprise at this stage in the development of green strategies the share of eco firms is still limited even in advanced countries that are seeking tools for a new competitiveness the full integration of eis within the internal capabilities and firm s own assets is far from being reached even in advanced and competitive industrial settings

reprint of the insurance value of state tax and transfer programs abstract this paper estimates the total value that individuals derive from their state s tax and transfer program and shows how this value varies by income the paper decomposes this total value into two components redistributive value which is due to predictable changes in income and family circumstances and insurance value which occurs when taxes and transfers compensate for unexpected income shocks our approach is a forward looking one where we examine income and transfers net of taxes over a 10 year period we model state taxes personal income taxes the eitc and sales taxes and state means tested transfers afdc tanf and medicaid schip the calculations are made using the panel study of income dynamics and allow for analysis of the role of changes in tax and transfer programs demographics and income in the value of state net benefits over a period of more than 30 years we find that the redistributive value of state tax and transfer programs sharply declines with income but that the insurance value is increasing in income the resulting total value still declines with income but not nearly as sharply as the redistributive value hence the insurance value mitigates the incentives for mobility that would undo state redistributive spending

taxation of investment and savings in a world economy the equilibrium of capital and equilibrium market prices are derived for a world economy with a unified securities market mobile capital no uncertainty and varying tax rates on different sources of income in each country the paper then characterizes optimal tax rates for a small country in this setting focusing on the peculiar incentives created when the before tax rate of return differs among securities due to differences in their typical tax treatment copyright 1986 by american economic association

the elasticity of taxable income evidence and implications abstract a central tax policy parameter that has recently received much attention but about which there is substantial uncertainty is the overall elasticity of taxable income we provide new estimates of this elasticity which address identification problems with previous work by exploiting a long panel of tax returns to study a series of tax reforms throughout the 1980s this identification strategy also allows us to provide new evidence on both the income effects of tax changes on taxable income and on variation in the elasticity of taxable income by income group we find that the overall elasticity of taxable income is approximately 0 4 the elasticity of real income not including tax preferences is much lower we estimate small income effects of tax changes on reported income implying that the compensated and uncompensated elasticities of taxable income are very similar we estimate that this overall elasticity is primarily due to a very elastic response of taxable income for taxpayers who have incomes above 100 000 per year who have an elasticity of 0 57 while for those with incomes below 100 000 per year the elasticity is less than one third as large moreover high income taxpayers who itemize are particularly responsive to taxation our estimates suggest that optimal tax structures may feature tightly targeted transfers to lower income taxpayers and a flat or even declining marginal rate structure for middle and high income taxpayers

a three input model of the spatial effects of a central city wage tax abstract this paper considers the short run and long run spatial effects on wages employment and business capital as functions of location of a localized increase in wage tax rates the model is most applicable to a central city that has a higher wage tax rate than the surrounding suburbs the inclusion of land as a third input in production significantly reduces the long run effects of a central city wage tax on employment near the central city boundary as compared with a model in which labor and capital are the only two inputs the short run effects are significantly less than the long run effects

tax competition with parasitic tax havens we develop a tax competition framework in which some jurisdictions called tax havens are parasitic on the revenues of other countries the havens use real resources to help companies camouflage their home country tax avoidance and countries use resources in an attempt to limit the transfer of tax revenues to the havens the equilibrium price for this service depends on the demand and supply for such protection recognizing that taxes on wage income are also evaded we solve for the equilibrium tax rates on mobile capital and immobile labor and we demonstrate that the full or partial elimination of tax havens would improve welfare in non haven countries in part because countries would be induced to increase their tax rates which they have set at inefficiently low levels in an attempt to attract mobile capital we also demonstrate that the smaller countries choose to become tax havens and we show that the abolishment of a sufficiently small number of the relatively large havens leaves all countries better off including the remaining havens

millionaire migration and taxation of the elite evidence from administrative data a growing number of u s states have adopted millionaire taxes on top income earners this increases the progressivity of state tax systems but it raises concerns about tax flight elites migrating from high tax to low tax states draining state revenues and undermining redistributive social policies are top income earners transitory millionaires searching for lower tax places to live or are they embedded elites who are reluctant to migrate away from places where they have been highly successful this question is central to understanding the social consequences of progressive taxation we draw on administrative tax returns for all million dollar income earners in the united states over 13 years tracking the states from which millionaires file their taxes our dataset contains 45 million tax records and provides census scale panel data on top income earners we advance two core analyses 1 state to state migration of millionaires over the long term and 2 a sharply focused discontinuity anal