Becker, Johannes and Fuest, Clemens (2011) Tax Competition – Greenfield Investment versus Mergers and Acquisitions. Regional Science and Urban Economics, 41 (5). pp. 476-486.
In this paper, we analyse tax competition in a model where investor firms have the choice between two types of investment, greenfield investment and mergers and acquisitions. We show that the coexistence of these two types of investment intensifies tax competition in comparison to the case where there is only greenfield investment. If a specific tax on acquisitions is available, this result changes. Then, tax competition is mitigated compared to the pure greenfield case. The existence of an acquisition tax may even lead to corporate overtaxation.
|Keywords:||Corporate taxation; Mergers and acquisitions; Tax competition|
|Centre:||Oxford University Centre for Business Taxation|
|Date Deposited:||28 May 2012 11:28|
|Last Modified:||23 Oct 2015 14:07|
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