Tax Competition and the Choice of Tax Structure in a Majority Voting Model
نویسندگان
چکیده
This note studies the choice of tax structure in a majority voting model with tax competition. Regions may tax mobile capital or immobile labor. Individuals differ with respect to their relative endowments of labor and capital. Even though a lump sum tax is available, the equilibrium capital tax in a jurisdiction may be positive. In a symmetric equilibrium, this will be true if the median capital endowment is smaller than average. JEL classification: H77, D72.
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