|Haufler, Andreas; Mittermaier, Ferdinand (2011): Unionisation Triggers Tax Incentives to Attract Foreign Direct Investment. In: Economic Journal, Vol. 121, No. 553: pp. 793-818|
This is the latest version of this item.
This article analyses tax competition between a unionised and a non-unionised country for the location of an outside firm. We show that unionisation increases the incentive for the government to attract a foreign investor, in order to affect the behaviour of the domestic union. This results in the unionised country’s government offering a tax discount (or a subsidy premium) to the outside firm in excess of what is needed to compensate the investor for the higher union wage. In equilibrium, therefore, the unionised country attracts the foreign investment, even if it has no other location advantages.
Economics > Chairs > Seminar for Economic Policy
|Subjects:||300 Social sciences > 330 Economics|
|Deposited On:||15. Apr 2014 08:59|
|Last Modified:||29. Apr 2016 09:17|
Available Versions of this Item
Unionisation triggers tax incentives to attract foreign direct investment. (deposited 08. May 2008 08:20)
- Unionisation Triggers Tax Incentives to Attract Foreign Direct Investment. (deposited 15. Apr 2014 08:59) [Currently Displayed]