Banks Defy Gravity in Tax Havens

49 Pages Posted: 21 Aug 2017 Last revised: 11 Feb 2021

See all articles by Vincent Bouvatier

Vincent Bouvatier

University Paris-Est Créteil (UPEC) - ERUDITE

Gunther Capelle-Blancard

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES); PSB Paris School of Business

Anne-Laure Delatte

CNRS

Date Written: August 2017

Abstract

Using country-by-country reports from the Systemically Important Banks in the European Union, we measure "abnormal'' banking activity in tax havens (TH). Our assessment is based on a gravity model used to predict the expected international turnover of EU banks worldwide. We find that: 1) banks turnover in TH represents on average twice the gravity predictions; 2) the abnormal turnover of EU banks represents 1.46\% of GDP in TH and varies between 16\% of GDP and zero; 3) there is a large heterogeneity across TH with Hong Kong, Luxembourg and Singapore concentrating the bulk of the abnormal turnover; 4) we observe a decline and a concentration of abnormal turnover since the reporting requirement has been introduced in the EU.

JEL Classification: F23, G21, H22, H32

Suggested Citation

Bouvatier, Vincent and Capelle-Blancard, Gunther and Delatte, Anne-Laure, Banks Defy Gravity in Tax Havens (August 2017). CEPR Discussion Paper No. DP12222, Available at SSRN: https://ssrn.com/abstract=3023206

Vincent Bouvatier (Contact Author)

University Paris-Est Créteil (UPEC) - ERUDITE ( email )

Mail des Mèches
61 avenue du Général de Gaulle
Créteil Cedex, 94010
France

Gunther Capelle-Blancard

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES) ( email )

106-112 Boulevard de l'hopital
106-112 Boulevard de l'Hôpital
Paris Cedex 13, 75647
France

PSB Paris School of Business ( email )

59 rue Nationale
Paris, 75013
France

Anne-Laure Delatte

CNRS ( email )

3, rue Michel-Ange
Paris, 75794
France

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