Picture of smart phone in human hand

World leading smartphone and mobile technology research at Strathclyde...

The Strathprints institutional repository is a digital archive of University of Strathclyde's Open Access research outputs. Strathprints provides access to thousands of Open Access research papers by University of Strathclyde researchers, including by Strathclyde researchers from the Department of Computer & Information Sciences involved in researching exciting new applications for mobile and smartphone technology. But the transformative application of mobile technologies is also the focus of research within disciplines as diverse as Electronic & Electrical Engineering, Marketing, Human Resource Management and Biomedical Enginering, among others.

Explore Strathclyde's Open Access research on smartphone technology now...

Tax competition and the international distribution of firm ownership : an invariance result

Ferrett, B. and Wooton, I. (2010) Tax competition and the international distribution of firm ownership : an invariance result. International Tax and Public Finance, 17 (5). pp. 518-531. ISSN 0927-5940

[img]
Preview
PDF (Tax_Competition_and_the_International_Distribution_of_Firm_Ownership.pdf)
Tax_Competition_and_the_International_Distribution_of_Firm_Ownership.pdf

Download (163kB) | Preview

Abstract

How does the international distribution of firm ownership affect the outcomes of tax/subsidy competition for mobile plants? As corporate ownership becomes increasingly globalised, this question becomes increasingly important for policy. We prove a strong invariance result in the context of the tax/subsidy competition between two host countries for a monopoly firm's plant. Both the equilibrium plant location and the equilibrium tax/subsidy offers are independent of the international distribution of the firm's ownership. The reason is that the tax/subsidy competition equalises the firm's post-tax profits across countries, making owners of capital indifferent towards the location of production.