Economic geography and the fiscal effects of regional integration

• 成果类型: Article; Proceedings Paper
• 署名作者: Ludema, RD; Wooton, I
• 署名单位: Georgetown University; University of Glasgow; Centre for Economic Policy Research - UK
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/S0022-1996(99)00050-1
• 发表日期: 2000
• 页码: 331-357
• 关键词: Economic geography; integration; factor mobility; Tax competition

摘要

In models of economic geography, plant-level scale economies and trade costs create incentives for spatial agglomeration of production into a manufacturing core and agricultural periphery, creating regional income differentials. We examine tax competition between national governments to influence the location of manufacturing activity. Labor is imperfectly mobile and governments impose redistributive taxes. Regional integration is modeled as either increased labor mobility or lower trade costs. We show that either type of integration may result in a decrease in the intensity of tax competition, and thus higher equilibrium taxes. Moreover, economic integration must increase taxes when the forces of agglomeration are the strongest. (C) 2000 Elsevier Science B.V. All rights reserved.