Do low corporate income tax rates attract FDI? – Evidence from Central- and East European Countries

Abstract: Fifty six bilateral country relationships combining 7 home countries from the EU and the US, and 8 Central and East European host countries (CEECs) of foreign direct investment (FDI) from 1995-2003 are used in a panel gravity-model setting to estimate the role of taxation as a determinant of FDI. While gravity variables explain most of the variation of FDI inflows, the bilateral effective average tax rate (beatr) is roughly equally important to other cost-related factors. The semi-elasticity of FDI with respect to taxation is about -4.3. This is above those of earlier studies in absolute terms and can partly be attributed to using the beatr instead of the statutory tax rate. Our results indicate that tax-lowering strategies of CEEC governments seem to have an important impact on foreign firms’ location decisions

Standort
Deutsche Nationalbibliothek Frankfurt am Main
Umfang
Online-Ressource
Sprache
Englisch
Anmerkungen
Postprint
begutachtet (peer reviewed)
In: Applied Economics ; 41 (2009) 21 ; 2691-2703

Klassifikation
Wirtschaft

Ereignis
Veröffentlichung
(wo)
Mannheim
(wann)
2009
Urheber
Bellak, Christian
Leibrecht, Markus

DOI
10.1080/00036840701320217
URN
urn:nbn:de:0168-ssoar-240754
Rechteinformation
Open Access unbekannt; Open Access; Der Zugriff auf das Objekt ist unbeschränkt möglich.
Letzte Aktualisierung
25.03.2025, 13:51 MEZ

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Beteiligte

  • Bellak, Christian
  • Leibrecht, Markus

Entstanden

  • 2009

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