The Taxing Deed of Globalization

Egger, Peter; Nigai, Sergey; Strecker, Nora

doi:10.1257/aer.20160600

Cited by 83 publications

(56 citation statements)

References 71 publications

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“…globalization, since the liberalization of factor markets made it increasingly difficult for national governments to raise tax revenues from top earners and multinational companies. Focusing on a large sample of 65 countries, Egger, Nigai, and Strecker (2019) find that between 1994 and 2007 there has been a globalization-induced rise in the labor-income tax burden of the middle class, while the top 1 percent of workers and employees witnessed a reduction. In parallel, there has been a decline in corporate taxes, and profit-shifting practices to tax havens have soared.…”

Section: Globalizationmentioning

confidence: 99%

The Surge of Economic Nationalism in Western Europe

Colantone

Stanig

2019

Journal of Economic Perspectives

122

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We document the surge of economic nationalist and radical-right parties in western Europe between the early 1990s and 2016. We discuss how economic shocks contribute to explaining this political shift, looking in turn at theory and evidence on the political effects of globalization, technological change, the financial and sovereign debt crises of 2008–2009 and 2011–2013, and immigration. The main message that emerges is that failures in addressing the distributional consequences of economic shocks are a key factor behind the success of nationalist and radical-right parties. We discuss how the economic explanations compete with and complement the “cultural backlash” view. We reflect on possible future political developments, which depend on the evolving intensities of economic shocks, on the strength and persistence of adjustment costs, and on changes on the supply side of politics.

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Section: Globalizationmentioning

confidence: 99%

The Surge of Economic Nationalism in Western Europe

Colantone

Stanig

2019

Journal of Economic Perspectives

122

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“…684-685). Third, the distributive consequences of tax cuts on corporate profits and personal capital income match a tax competition account: governments have shifted the tax burden from internationally mobile capital to immobile factors (Egger et al, 2019).…”

Section: Capital Taxation In Open Economiesmentioning

confidence: 99%

Is neoliberalism still spreading? The impact of international cooperation on capital taxation

Hakelberg

Rixen

2020

Review of International Political Economy

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The downward trend in capital taxes since the 1980s has recently reversed for personal capital income. At the same time, it continued for corporate profits. Why have these tax rates diverged after a long period of parallel decline? We argue that the answer lies in different levels of change in the fights against tax evasion and tax avoidance. The fight against evasion by households progressed significantly since 2009, culminating in the multilateral adoption of automatic exchange of information (AEI). In contrast, international efforts against base erosion and profit shifting (BEPS) failed to curb tax avoidance by corporations. We theorize that international cooperation is an intervening variable, countering the negative impact of tax competition on capital taxation by reducing the risk of capital flight. Under such conditions, domestic political pressures in favor of higher capital taxes can unfold. We confirm our argument in a differencein-difference analysis and through additional tests with data for up to 35 OECD countries from 2000-2017. Our central estimate suggests that the average tax rate on dividends in 2017 is 4.5 percentage points higher than it would have been absent international tax cooperation.

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“…According to the literature (Egger, Nigai, & Strecker, 2019), these shifts can be explained to some extent by the greater mobility of top income earners due to economic integration. This suggests that, in absence of international coordination, globalisation limits the capacities of countries to design their tax policies, including redistribution.…”

Section: Box 25: Tax Competition In Personal Income Taxationmentioning

confidence: 99%

“…and Box 1.1: Distribution of overall tax mix). Source: Own computations based on dataset for (Egger, Nigai, & Strecker, 2019). Notes: (1) The 10th (20th, etc.)…”

Section: Box 25: Tax Competition In Personal Income Taxationmentioning

confidence: 99%