International taxation and multinational firm location decisions
Using a large international firm-level data set, we examine the separate effects of host and additional parent
country taxation on the location decisions of multinational firms. Both types of taxation are estimated to have
a negative impact on the location of new foreign subsidiaries. The impact of parent country taxation is estimated
to be sizeable consistent with its international discriminatory nature. Our results show that international
double taxation by the parent country – despite the general possibility of deferral of taxation until
income repatriation – is instrumental in shaping the structure of multinational enterprise.
BARRIOS Salvador;
HUIZINGA Harry;
LAEVEN Luc;
NICODEME Gaetan;
2014-11-28
ELSEVIER SCIENCE SA
JRC77242
0047-2727,
http://www.sciencedirect.com/science/article/pii/S0047272712000679,
https://publications.jrc.ec.europa.eu/repository/handle/JRC77242,
10.1016/j.jpubeco.2012.06.004,
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