Dundee Discussion Papers in Economics 198: Foreign direct investment, tax competition and social expenditure

TY - UNPB

T1 - Dundee Discussion Papers in Economics 198

T2 - Foreign direct investment, tax competition and social expenditure

AU - Görg, H.

AU - Molana, H.

AU - Montagna, C.

N1 - This paper was also published by Elsevier in International Review of Economics & Finance, Vol. 18 (1), pp. 31-37

PY - 2007

Y1 - 2007

N2 - The aim of this paper is to make a first step towards studying the role of social expenditure and its interaction with corporate taxation in determining the destination of foreign direct investment (FDI) flows. Using panel data for 18 OECD countries and measuring the extent of social welfare policies by the (public social expenditure)/GDP ratio, we find strong support for the conjecture that redistributive social welfare state policies are valued by multinationals as, for instance, they may signal a government’s commitment to social stability.

AB - The aim of this paper is to make a first step towards studying the role of social expenditure and its interaction with corporate taxation in determining the destination of foreign direct investment (FDI) flows. Using panel data for 18 OECD countries and measuring the extent of social welfare policies by the (public social expenditure)/GDP ratio, we find strong support for the conjecture that redistributive social welfare state policies are valued by multinationals as, for instance, they may signal a government’s commitment to social stability.

KW - Foreign direct investment

KW - Tax competition

KW - Social policy

M3 - Discussion paper

T3 - Dundee Discussion Papers in Economics

BT - Dundee Discussion Papers in Economics 198

PB - University of Dundee

ER -