Ferrett-Wooton2021_Article_TargetingFDI.pdf (998.65 kB)

Targeting FDI

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journal contribution
posted on 26.08.2020, 13:01 by Ben Ferrett, Ian Wooton
We study the tax/subsidy competition between two countries to attract the FDI projects of two firms. We assume that governments lack the capacity to target every potential inward investor such that each can only bid for a single firm. When the characteristics of the two countries are common knowledge, subsidy competition never arises in equilibrium. Both governments may target the same firm if there is uncertainty as to the more profitable location for that firm’s plant, such that both governments believe they may win the competition. We also explore how such uncertainty affects the firms’ after-tax profits.

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Loughborough Publications

Categories

History

School

  • Business and Economics

Department

  • Economics

Published in

International Tax and Public Finance

Volume

28

Issue

2

Pages

366-385

Publisher

Springer Verlag

Version

VoR (Version of Record)

Rights holder

© The Authors

Publisher statement

This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/.

Acceptance date

28/08/2020

Publication date

2020-09-19

Copyright date

2020

ISSN

0927-5940

eISSN

1573-6970

Language

en

Depositor

Dr Ben Ferrett. Deposit date: 26 August 2020

Licence

Exports

Read the paper on the publisher website

Loughborough Publications

Categories

Licence

Exports