Interregional Competition for Mobile Creative Capital With and Without Physical Capital Mobility

A lacuna in the extant literature and our desire to contribute theoretical on how tax/subsidy policies can be used by regions attract creative class together provide motivation for this paper. The paper’s basic contribution is that it first theoretically analyze competition between two (1 2) mobile capital, key attribute possessed class. Both produce a final good using physical capital. In case, capital immobile only region 2 uses tax policy We compute equilibrium returns we specify condition aggregate economy, show which of three gives highest income. second are both pursue Once again, then describe optimal taxes given they wish maximize regional