Arbeitspapier
Competition for FDI and Profit Shifting
When countries compete for the location of a new multinational plant they need to be aware of the profit shifting opportunities this new plant creates for the global multinational firm. By modelling explicitly the multinational's intra-firm transactions, we show that the home market advantage that large countries have due to their size will be counteracted by such profit shifting opportunities. As a result of this, large countries will not be able to capitalize on their size and sustain high corporate taxes. We show that, on the basis of these profit shifting opportunities, a small country can easily win the location game ahead of a large country. How lenient the small country is in implementing transfer pricing regulations turns out to be an important variable in such location games.
- Sprache
-
Englisch
- Erschienen in
-
Series: CESifo Working Paper ; No. 5153
- Klassifikation
-
Wirtschaft
Business Taxes and Subsidies including sales and value-added (VAT)
Multinational Firms; International Business
- Thema
-
profit shifting
competition for FDI
location game
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Ma, Jie
Raimondos-Møller, Pascalis
- Ereignis
-
Veröffentlichung
- (wer)
-
Center for Economic Studies and ifo Institute (CESifo)
- (wo)
-
Munich
- (wann)
-
2015
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Ma, Jie
- Raimondos-Møller, Pascalis
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2015
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