Details
| Original language | English |
|---|---|
| Pages (from-to) | 1251-1264 |
| Number of pages | 14 |
| Journal | International economic review |
| Volume | 54 |
| Issue number | 4 |
| Publication status | Published - 25 Oct 2013 |
Abstract
Rather than about their absolute payoffs, governments in fiscal competition often seem to care about their performance relative to other governments. Moreover, they often appear to mimic policies observed elsewhere. I study such behavior in a standard tax competition game. Both with relative payoff concerns and for imitative policies, evolutionary stability for games with finitely many players is the appropriate solution concept. Independently of the number of jurisdictions involved, an evolutionarily stable tax policy coincides with the competitive outcome of a tax competition game with infinitely many players. It, thus, involves drastic efficiency losses.
ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)
- Economics and Econometrics
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In: International economic review, Vol. 54, No. 4, 25.10.2013, p. 1251-1264.
Research output: Contribution to journal › Article › Research › peer review
}
TY - JOUR
T1 - Tax competition, relative performance, and policy imitation
AU - Wagener, Andreas
PY - 2013/10/25
Y1 - 2013/10/25
N2 - Rather than about their absolute payoffs, governments in fiscal competition often seem to care about their performance relative to other governments. Moreover, they often appear to mimic policies observed elsewhere. I study such behavior in a standard tax competition game. Both with relative payoff concerns and for imitative policies, evolutionary stability for games with finitely many players is the appropriate solution concept. Independently of the number of jurisdictions involved, an evolutionarily stable tax policy coincides with the competitive outcome of a tax competition game with infinitely many players. It, thus, involves drastic efficiency losses.
AB - Rather than about their absolute payoffs, governments in fiscal competition often seem to care about their performance relative to other governments. Moreover, they often appear to mimic policies observed elsewhere. I study such behavior in a standard tax competition game. Both with relative payoff concerns and for imitative policies, evolutionary stability for games with finitely many players is the appropriate solution concept. Independently of the number of jurisdictions involved, an evolutionarily stable tax policy coincides with the competitive outcome of a tax competition game with infinitely many players. It, thus, involves drastic efficiency losses.
UR - http://www.scopus.com/inward/record.url?scp=84886391234&partnerID=8YFLogxK
U2 - 10.1111/iere.12035
DO - 10.1111/iere.12035
M3 - Article
AN - SCOPUS:84886391234
VL - 54
SP - 1251
EP - 1264
JO - International economic review
JF - International economic review
SN - 0020-6598
IS - 4
ER -