[Article] Tax competition and information sharing in Europe: a signalling game

This paper provides a challenging view to the tax harmonisation issue. The model proposed here shows that tax competition may lead to stability.

Andre Fourcans , Thierry Warin https://www.warin.ca (HEC Montréal and CIRANO (Canada))https://www.hec.ca/en/profs/thierry.warin.html
12-01-2009

Abstract

This paper provides a challenging view to the tax harmonisation issue. The literature often proposes tax harmonisation to avoid free-riding behaviours in free-trade areas and more particularly in monetary unions. Without tax harmonisation, tax autonomy may lead to a ||race to the bottom||. The model proposed here shows that tax competition may lead to stability. If a country gives the signal that |friendly| or coordinated taxation behaviour is not its priority, the result can be a |race to the bottom|. Conversely, if both countries signal their ability to conduct such a war, this war will not occur, and the stability of the system will be ensured.

Keywords: EMU; Economic and Monetary Union; economic integration; tax competition; tax harmonisation; fiscal competition; taxation; European Union; EU; free-trade areas; information sharing; business research; Euro


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Citation

For attribution, please cite this work as

Fourcans & Warin, "Thierry Warin: [Article] Tax competition and information sharing in Europe: a signalling game", International Journal of Economics and Business Research, 2009

BibTeX citation

@article{fourcans2009[article],
  author = {Fourcans, Andre and Warin, Thierry},
  title = {Thierry Warin: [Article] Tax competition and information sharing in Europe: a signalling game},
  journal = {International Journal of Economics and Business Research},
  year = {2009},
  note = {https://warin.ca/posts/article-tax-competition/},
  doi = {10.1504/IJEBR.2010.029730}
}