Abstract

http://ssrn.com/abstract=1636010
 
 

Citations (1)



 


 



A Multinational Analysis of Tax Rates and Economic Activity


Lawrence C. Smith Jr.


Louisiana Tech University

Murphy Smith


Murray State University - College of Business

William C. Gruben


Texas A&M International University

2010

Journal of International Business Research, Forthcoming

Abstract:     
The relationship between taxes, particularly the income tax, and economic activity is a factor in the economic progress and development of a national economy. This study examines the relationship between the corporate income tax rate and economic activity in 30 countries, the members of the Organization of Economic Cooperation and Development. Results indicate that lower tax rates are associated with more favorable economic activity, including growth in GDP, lower unemployment, and higher savings. These findings suggest that at the micro-level, corporate managers should consider tax rates when deciding to locate or not locate business operations within a given country, especially if the goal is to locate where the economy is dynamic. At the macro-level, before making changes to tax law, policy makers should carefully consider how tax rates affect economic activity. For example, policy makers in the US Congress, at the time of this writing, are considering whether to allow the Bush tax cuts to expire in 2010. If the Congress allows that to happen, the outcome would effectively be the largest tax increase in US history.

Number of Pages in PDF File: 22

Keywords: multinational, income tax, economics, tax policy, tax increase, corporate tax rate

JEL Classification: F23, G15, M41

Accepted Paper Series


Download This Paper

Date posted: July 9, 2010  

Suggested Citation

Smith, Lawrence C. and Smith, Murphy and Gruben, William C., A Multinational Analysis of Tax Rates and Economic Activity (2010). Journal of International Business Research, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1636010

Contact Information

Lawrence C. Smith Jr.
Louisiana Tech University ( email )
P.O. Box 3178
Ruston, LA 71272
United States
Murphy Smith (Contact Author)
Murray State University - College of Business ( email )
109 Business Building
Murray, KY 42071-3314
United States
270-809-4181 (Phone)
William C. Gruben
Texas A&M International University ( email )
Laredo, TX 78041
United States
Feedback to SSRN


Paper statistics
Abstract Views: 1,064
Downloads: 183
Download Rank: 95,951
Citations:  1

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo8 in 0.250 seconds