nep-pub New Economics Papers
on Public Finance
Issue of 2009‒04‒25
five papers chosen by
Kwang Soo Cheong
Johns Hopkins University

  1. Tax burden by economic function A comparison for the EU Member States By De Laet, Jean-Pierre; Wöhlbier, Florian
  2. Are your firmÕs taxes set in Warsaw ? Spatial tax competition in Europe By Karen, CRABBE; Hylke, VANDENBUSSCHE
  3. Public goodsÕ attractiveness and migrations By Jean J., GABSZEWICZ; Salome, GVETADZE; Didier, LAUSSEL; Patrice, PIERETTI
  4. Financing Social Security - Simulating Different Welfare State Systems for Germany By Dieckhoener C; Peichl A
  5. Public pension and household saving: Evidence from China By Feng, Jin; He, Lixin; Sato, Hiroshi

  1. By: De Laet, Jean-Pierre; Wöhlbier, Florian
    Abstract: Policy makers as well as taxpayers are interested in comparing the tax burden in their countries with others, particularly given the wide variations in taxation levels and policies. In order to assess the heterogeneous national tax systems on a fully comparable basis, it is essential to have a unified statistical framework. This paper presents key trends in the tax burden in the Member States of the European Union, based on the European Commission's report 'Taxation trends in the European Union' The main focus lies on analysing the tax burden by economic function (i.e. consumption, labour and capital). The paper presents the methodology that is applied in order to allocate the tax revenue of the different taxes to the economic functions. Moreover, we present measures for the average effective tax burden on different types of income or activities, the so-called implicit tax rates. Results of the calculations are presented looking both at differences between Member States and trends over time.
    Keywords: tax burden; tax indicators; effective tax rates
    JEL: H20 E00 H71
    Date: 2008–12–01
    Abstract: Tax competition within the EU is fiercer than in the rest of the OECD with tax rates falling rapidly. This paper analyzes tax responses of EU-15 countries to corporate tax changes in the EU-10 new member states as a function of their proximity to these new member states. The average corporate tax rate in the new member states has always been considerably lower than the average in the EU-15 countries. Their entry into the EU eliminated capital barriers, allowing firms to locate in one of the new EU-10 with full access to the European Market. Our results indicate that EU-15 countries geographically closer to the new member states respond stronger to corporate tax changes in these new member states. We use a theoretical and a spatial regression framework to test the hypothesis that distance to a low tax region intensifies countriesÕ tax reaction functions
    Keywords: H25; H77; H39
    Date: 2008–12–05
  3. By: Jean J., GABSZEWICZ (UNIVERSITE CATHOLIQUE DE LOUVAIN, Department of Economics); Salome, GVETADZE; Didier, LAUSSEL; Patrice, PIERETTI
    Abstract: The aim of this paper is to develop a dynamic model of migrations, in which migration is driven by size asymmetries between countries and by the relative preferences of consumers between private consumption and consumption of public goods. The dynamic trajectories heavily depend on the degree of attractiveness for public goods. We show that monotone migrations require sufficiently strong preferences for public goods, and can only be sustained from the small of the large countries. We identify the threshold value of the public goodsÕ intensity of preferences guaranteeing the survival of the small country. For weaker preference intensities, oscillating migrations may rise, but they finally converge to situation where both countries are of equal size
    Keywords: Migration; public goods; income tax
    JEL: H
    Date: 2008–12–04
  4. By: Dieckhoener C; Peichl A
    Abstract: In Germany, there is an ongoing debate about how to increase the efficiency of the social security system and especially its financing. The aim of this paper is to simulate different financing systems for Germany. The introduction of a Liberal British or the Southern Greek financing system increases inequality and poverty, as well as labour supply incentives. The introduction of the Social-democratic Danish financing system decreases inequality of incomes, but does not necessarily lead to less poverty. Tax payments are extremely high, whereas social contribution payments are relatively low leading to mixed incentives effects.
    Keywords: EUROMOD, Social Security, Welfare States, comparative analysis
    JEL: C81 D31 H24
    Date: 2009–04–16
  5. By: Feng, Jin (BOFIT); He, Lixin (BOFIT); Sato, Hiroshi (BOFIT)
    Abstract: We relate household saving to pension reform, to explain the high household saving rates in urban China from a new perspective. We use the exogenous – policy induced - variation in pension wealth to explicitly estimate the impact of pension wealth on household saving, and obtain a significant offset effect of pension wealth on household saving. Our estima-tions show that pension reform boosted the household saving rate in 1999 by about 6 per-centage points for cohort aged 25-29 and by about 3 percentage points for cohort aged 50-59. Our results also indicate that declining pension wealth reduces expenditure on educa-tion and health more than on other consumption items.
    Keywords: pensions; pension reform; household savings rate; China
    JEL: H31 H55 P35
    Date: 2009–04–20

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