When Does International Capital Mobility Require Tax Coordination
CentER Working Paper No. 1999-27
Posted: 12 Jul 1999
Date Written: 1999
Basic economic theory identifies a number of efficiency gains that derive from international capital mobility. But just as with free trade in goods, there is no guarantee that capital mobility makes everyone better off. Consequently, capital mobility may be politically unsustainable even though it enhances efficiency. This paper discusses how such a dilemma might arise, and suggests that international tax coordination might serve as a way out under some circumstances.
JEL Classification: H25, F32, F42
Suggested Citation: Suggested Citation