Arbeitspapier
Competition for firms in an oligopolistic industry: do firms or countries have to pay?
We set up a model of generalised oligopoly where two countries of different size compete for an exogenous, but variable, number of identical firms. The model combines a desire by national governments to attract internationally mobile firms with the existence of location rents that arise even in a symmetric equilibrium where firms are dispersed. As economic integration proceeds, equilibrium taxes decline, switching from positive to negative levels, and then rise as trade costs fall even further. A range of trade costs is identified where economic integration raises the welfare of the small country, but lowers welfare in the large country.
- Language
-
Englisch
- Bibliographic citation
-
Series: CESifo Working Paper ; No. 1976
- Classification
-
Wirtschaft
Business Taxes and Subsidies including sales and value-added (VAT)
State and Local Government; Intergovernmental Relations: Interjurisdictional Differentials and Their Effects
Economic Integration
Multinational Firms; International Business
- Subject
-
Direktinvestition
Steuerwettbewerb
Subvention
Standortwettbewerb
Oligopol
Wirtschaftsintegration
Wohlfahrtseffekt
Zwei-Länder-Modell
Theorie
- Event
-
Geistige Schöpfung
- (who)
-
Haufler, Andreas
Wooton, Ian
- Event
-
Veröffentlichung
- (who)
-
Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2007
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Haufler, Andreas
- Wooton, Ian
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2007