Citizenship Taxation, Globalization and Inequality

The U.S alone claims the right to tax its citizens regardless of country of residence. Other states allow their citizens to forego national taxes if they reside abroad for extended periods; this is residence taxation. Many commentators stress the extraordinary gap between the compre-hensiveness of U.S. claims and the long history of wholly inadequate enforcement, pronouncing citizenship taxation infeasible. Some have claimed that uniquely intrusive U.S. claims violate customary interna¬tional law. On the other side are those who see citizenship taxation as a tool for greater intra-nation equality within the high-income countries and perhaps as a development measure for poorer countries as well. This paper will defend U.S. citizenship taxation and propose policy modifications that balance increased inequality concerns6 with the continuing realities of globalization. The paper first briefly reviews the appropriate goals of international taxation. It then presents a defense of citizenship taxation stressing the contribution of the U.S. environment to the continuing material success of those who subsequently choose to live abroad. Current U.S. policy is then examined in detail, and revi¬sions are suggested both for Americans who wish to retain their citizen¬ship and those who do not. Efforts to collect revenue from both groups have largely failed so far. The reasons for this failure and the measures needed to improve collection are explored at the end of the paper

Do Tougher Licensing Provisions Limit Occupational Entry? The Case of Dentistry

The effect of licensing as a mechanism to control entry into occupations has been a neglected area of both regulation and labor market research. This study examines the role of occupational licensing for entry into dentistry, an occupation with standards that vary by state. Our research first closely replicates Freeman's previous work on labor market cobwebs by employing national data to examine purely market phenomena in the determination of training for the dental profession. We subsequently approximate the government barrier to practice in the profession by adding a weighted average state examination pass rate to the previous model. Next, we employ pooled cross-section time series analysis to explore market determinants of professional entry with state level data. Finally, these results are supplemented by measures of statutory and pass rate entry restrictiveness. Our most consistent evidence suggests that a higher state licensing failure rate deters entry into dental practice.

How Is Competition Policy Coping with Atlantic Area Airline Markets?

Article published in the Michigan State Law Review

The Limited Prospects for International Tax Cooperation

The recent pace of international agreement aimed to reduce tax evasion and avoidance was completely unpredicted prior to the financial crisis. The two targets are often considered to be merely different dimensions of the same problem. This paper argues that the two problems actually involve very different logics, and this holds the key to the prospects for success. The assault on tax evasion confronts a problem that is commonly recognized and admits to amelioration through the increased information sharing that is rapidly, although unevenly, advancing. Attempts to reduce corporate tax avoidance, however, confront ambiguity at every turn. National corporate tax systems differ markedly from each other in rules as well as rates, and agreement necessarily takes place in an ever more competitive international business environment in which national rate and rule setting will remain largely independent. Moreover, increased attention to the international taxation of business seems to have increased rather than dampened unilateral initiatives to advance national gain

Minnesota as a Host for Foreign Direct Investment: A Comparison with Other States.

This report presents the results of a study conducted by the Freeman Center for International Economic Policy at the University of Minnesota, investigating how well Minnesota has fared in attracting foreign direct investment (FDI) compared with the other forty-seven contiguous states in the United States. Based on Bureau of Economic Analysis and International Trade Administration data for the year 1996, the study evaluated the significance of various state-level determinants of FDI, including gross state product, geographic location, economic structure, workforce unionization rate, and corporate income tax rate. Using employment figures as the primary measure of investment, the author measured Minnesota's FDI performance both for aggregate levels of investment, and for eight individual investment sectors: manufacturing, retail trade, wholesale trade, finance, insurance, real estate, services, and other unclassified industries (agriculture, forestry, fishing, mining, construction, transportation, communication, and public utilities). The author found that a state's overall size and the existing structure of its economy were both significant factors in determining a state's FDI performance. Based on these results, he concludes that Minnesota should pursue and indirect approach to foreign direct investment policy by establishing a favorable climate for the attraction, retention, and growth of economnic activities that it regards as otherwise desirable