Even Small Trade Costs Restore Efficiency in Tax Competition

We introduce transport cost of trade in products into the classical Zodrow and Mieszkowski (1986) model of capital tax competition. It turns out that even small levels of transport cost lead to a complete breakdown of the seminal result, the underprovision of public goods. Instead, there is a symmetric equilibrium with efficient public goods provision in all jurisdictions.tax competition, public goods provision, trade

mhbounds - Sensitivity Analysis for Average Treatment Effects

Matching has become a popular approach to estimate average treatment effects. It is based on the conditional independence or unconfoundedness assumption. Checking the sensitivity of the estimated results with respect to deviations from this identifying assumption has become an increasingly important topic in the applied evaluation literature. If there are unobserved variables which affect assignment into treatment and the outcome variable simultaneously, a hidden bias might arise to which matching estimators are not robust. We address this problem with the bounding approach proposed by Rosenbaum (2002), where mhbounds allows the researcher to determine how strongly an unmeasured variable must influence the selection process in order to undermine the implications of the matching analysis.matching, treatment effects, sensitivity analysis, unobserved heterogeneity

Detection and visualisation of climate trends in China

Research on climate trends in China has been carried out within a co-operation of the Justus Liebig Universities Department of Geography and Zentrum für internationale Entwicklungs- und Umweltforschung (ZEU) and the Nanjing Institute of Geography and Limnology (CAS). First results were introduced by BECKER et al. 2003 a, b who worked on precipitation trend analyses in the Yangtze River Catchment. In the meanwhile, the National Climatic Centre of China (NCCC) kindly provided climatic data in China within the framework of this co-operation. Financial support from the CAS Key project KZCX3-SW-331 and the NSFC project 40271112 enabled the data acquisition. The analysis of both, precipitation and temperature data for the whole of China from 1951- 2002 can be carried out now. A shorter version of the precipitation trend observation will soon be published in Theoretical and Applied Climatology (GEMMER et al. 2003, accepted for publication/in print). Results of the temperature trend research have not been published yet. They will be submitted to an international Journal when further statistical approaches with regard to daily temperature data are processed. The discussion paper in hand will make the actual results accessible for further research groups in Germany. --

Cheeger-Simons differential characters with compact support and Pontryagin duality

By adapting the Cheeger-Simons approach to differential cohomology, we establish a notion of differential cohomology with compact support. We show that it is functorial with respect to open embeddings and that it fits into a natural diagram of exact sequences which compare it to compactly supported singular cohomology and differential forms with compact support, in full analogy to ordinary differential cohomology. We prove an excision theorem for differential cohomology using a suitable relative version. Furthermore, we use our model to give an independent proof of Pontryagin duality for differential cohomology recovering a result of [Harvey, Lawson, Zweck - Amer. J. Math. 125 (2003) 791]: On any oriented manifold, ordinary differential cohomology is isomorphic to the smooth Pontryagin dual of compactly supported differential cohomology. For manifolds of finite-type, a similar result is obtained interchanging ordinary with compactly supported differential cohomology.Comment: 33 pages, no figures - v3: Final version to be published in Communications in Analysis and Geometr

Even Small Trade Costs Restore Efficiency in Tax Competition

We introduce transport cost of trade in products into the classical Zodrow and Mieszkowski (1986) model of capital tax competition. It turns out that even small levels of transport cost lead to a complete breakdown of the seminal result, the underprovision of public goods. Instead, there is a symmetric equilibrium with efficient public goods provision in all jurisdictions

Corporate tax regime and international allocation of ownership

Would the introduction of a corporate tax system with consolidated tax base and formula apportionment lead to socially wasteful mergers and acquisitions across borders? This paper analyzes a two-country model with an international investor considering acquisitions of already existing target firms in a high-tax country and a low-tax country. The investor is able to shift profits from one location to another for tax saving purposes. Two systems of corporate taxation are compared, a system with separate accounting and a system with tax base consolidation and formula apportionment. It is shown that, under separate accounting, the number of acquisitions is inefficiently ciently high in both the high tax and the low tax country. Under formula apportionment, the number of acquisitions is inefficiently ciently high in the low tax country and inefficiently ciently low in the high tax country. Under tax competition, a novel externality arises that worsens the effciency; ciency properties of equilibrium tax rates under separate accounting, but may play an effciency; ciency enhancing role under formula apportionment

On the X-ray feature associated with the Guitar Nebula

Context: A mysterious X-ray nebula, showing a remarkably linear geometry, was recently discovered close to the Guitar Nebula, the bow-shock nebula associated with B2224+65, which is the fastest pulsar known. The nature of this X-ray feature is unknown, and even its association with pulsar B2224+65 is unclear. Aims: We attempt to develop a self-consistent scenario to explain the complex phenomenology of this object. Methods: We assume that the highest energy electrons accelerated at the termination shock escape from the bow shock and diffuse into the ambient medium, where they emit synchrotron X-rays. The linear geometry should reflect the plane-parallel geometry of its ambient field. Results: We estimate the Lorentz factor of the X-ray emitting electrons and the strength of the magnetic field. The former (~10^8) is close to its maximum possible value, while the latter, at ~45 uG, is higher than typical interstellar values and must have been amplified in some way. The magnetic field must also be turbulent to some degree to trap the electrons sufficiently for synchrotron X-ray emission to occur effectively. We propose a self-consistent scenario in which, by some streaming instability, the electrons themselves generate a turbulent field in which they then diffuse. Some numerical coincidences are explained, and tests are proposed to verify our scenario. Conclusions: Electron leaking may be common in the majority of pulsar bow-shock nebulae, even though the X-ray nebulosity in general is too diffuse to be detectable.Comment: 4 pages. Accepted for publication in A&A, Letters to the Edito

Corporate tax regime and international allocation of ownership

Would the introduction of a corporate tax system with consolidated tax base and formula apportionment lead to socially wasteful mergers and acquisitions across borders? This paper analyzes a two-country model with an international investor considering acquisitions of already existing target firms in a high-tax country and a low-tax country. The investor is able to shift profits from one location to another for tax saving purposes. Two systems of corporate taxation are compared, a system with separate accounting and a system with tax base consolidation and formula apportionment. It is shown that, under separate accounting, the number of acquisitions is inefficiently high in both the high tax and the low tax country. Under formula apportionment, the number of acquisitions is inefficiently high in the low tax country and inefficiently low in the high tax country. Under tax competition, a novel externality arises that worsens the efficiency properties of equilibrium tax rates under separate accounting, but may play an efficiency enhancing role under formula apportionment

Corporate tax regime and international allocation of ownership

Would the introduction of a corporate tax system with consolidated tax base and formula apportionment lead to socially wasteful mergers and acquisitions across borders? This paper analyzes a two-country model with an international investor considering acquisitions of already existing target firms in a high-tax country and a low-tax country. The investor is able to shift profits from one location to another for tax saving purposes. Two systems of corporate taxation are compared, a system with separate accounting and a system with tax base consolidation and formula apportionment. It is shown that, under separate accounting, the number of acquisitions is inefficiently ciently high in both the high tax and the low tax country. Under formula apportionment, the number of acquisitions is inefficiently ciently high in the low tax country and inefficiently ciently low in the high tax country. Under tax competition, a novel externality arises that worsens the effciency; ciency properties of equilibrium tax rates under separate accounting, but may play an effciency; ciency enhancing role under formula apportionment.Corporate Taxation, Separate Accounting, Formula Apportionment