How Socialization Attenuates Tax Competition

Gilardi, Fabrizio; Wasserfallen, Fabio (2016). How Socialization Attenuates Tax Competition. British journal of political science, 46(1), pp. 45-65. Cambridge University Press 10.1017/S0007123414000246

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Tax competition is the quintessential example of policy interdependence. The general idea is that tax changes in one jurisdiction lead to similar changes in others. However, research has shown that institutional and political constraints limit competition. This article develops another argument: that socialization among policy makers attenuates competitive dynamics by setting limits to the extent of competition that is considered acceptable. Using fine-grained Swiss data and spatial econometric techniques, it shows that personal income tax rates are more strongly correlated among competitors that do not participate in the same intergovernmental organizations. This finding implies that, to some extent, the detrimental consequences of competition can be mitigated by fostering institutionalized forms of interaction among policy makers.

Item Type:

Journal Article (Original Article)

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Social Sciences > Institute of Political Science

UniBE Contributor:

Wasserfallen, Fabio Adriano

Subjects:

300 Social sciences, sociology & anthropology > 320 Political science

ISSN:

0007-1234

Publisher:

Cambridge University Press

Language:

English

Submitter:

Mirco Thomas Good

Date Deposited:

14 May 2020 13:52

Last Modified:

14 May 2020 13:52

Publisher DOI:

10.1017/S0007123414000246

BORIS DOI:

10.7892/boris.141483

URI:

https://boris.unibe.ch/id/eprint/141483

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