en

IEB

Universitat de Barcelona logotipo
Working Paper
Cities
Matthias Wrede

2009/05: Agglomeration, tax competition, and fiscal equalization

This paper analyzes the impact of fiscal equalization on asymmetric tax competition when positive agglomeration externalities are present. It shows that equalization of standardized tax revenue improves the spatial allocation of capital provided that agglomeration externalities are sufficiently strong.



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