This paper analyzes the impact of broadband infrastructure, along with a range of other local characteristics such as motorways and other infrastructure, availability of human capital, and access to third-level educational facilities, on the location of new business establishments. The sample period spans the introduction and recent history of broadband in Ireland. The results indicate that the availability of broadband infrastructure is a significant determinant, but its effects may be mediated by the presence of sufficiently high human capital in an area.

No abstract

Abstract:The corporate tax rate and regime are policy instruments that are the subject of considerable attention for the role they play in attracting foreign multinationals making location decisions across countries. This paper examines the effects of corporate tax on these location decisions of newly established multinational subsidiaries across 26 European countries over an eight year period. We contribute to the existing literature by examining the effects of a non-linear response of firm location decisions to changes in the tax rate. We find that accounting for this nonlinearity improves the performance of the model for all of the alternative measures of the tax rate. We also show that there are large variations in the sensitivity to tax rates across sectors and firm size groups. In particular, financial sector firms are more than twice as sensitive to changes in corporation tax rates relative to other sectors. JEL Code: F23, H25, C25