Market-Creating Tax Competition

Econpubblica Working Paper No. 100

46 Pages Posted: 15 Oct 2004

See all articles by Luciano G. Greco

Luciano G. Greco

University of Padua - Department of Economics

Date Written: October 2004

Abstract

Tax competition may create new markets, by imposing fiscal restraints, and affect the relative performance of public programs in which the public and private provision coexist (universal or topping up) or are alternative (selective or opting out). Tax competition dwindles the scope of universal programs, while selective programs are relatively immune to it. However, the existence of a minimum operative scale, and the possible mismatch between opting-in and optimal target population may provoke the inefficiency of the latter. A social welfare ranking of universal and selective programs relies on the economic structure, and on government's preference for redistribution.

Keywords: Tax competition, privatization of public services, in-kind transfers

JEL Classification: H7, H4

Suggested Citation

Greco, Luciano G., Market-Creating Tax Competition (October 2004). Econpubblica Working Paper No. 100. Available at SSRN: https://ssrn.com/abstract=605066 or http://dx.doi.org/10.2139/ssrn.605066

Luciano G. Greco (Contact Author)

University of Padua - Department of Economics ( email )

via Del Santo 33
Padova, 35123
Italy

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