@article{oai:nagoya.repo.nii.ac.jp:02001110,
 author = {Tamai, Toshiki},
 issue = {E21-2},
 journal = {Economic Research Center Discussion Paper E-Series},
 month = {Feb},
 note = {Tax competition is one of the central issues of the interregional and public finance analyses. We address this issue by focusing on the dynamic aspects of tax competition and developing an en- dogenous growth model. This model incorporates knowledge spillover, perfectly mobile capital, and local public goods financed by capital tax. We show that equilibrium tax rate negatively as- sociates with the degree of tax competition. Hence, escalating tax competition stimulates capital accumulation in a dynamic model and enhances economic growth by lowering tax rates. The tax rates and economic growth may have a hump-shaped relationship through a change in the number of regions if the congestion effect on common knowledge access is sufficiently large. Regarding efficiency in a decentralized economy, fierce tax competition worsens social welfare even if it raises equilibrium growth rate. Thus, undersupply of public goods due to intense competition must be addressed, in which tax coordination is desirable. However, mild tax competition is superior to tax coordination. Therefore, resolving insufficient investment due to knowledge spillover should be prioritized., This work was supported by JSPS KAKENHI Grant Numbers 16K03726, 18H00865, 20H01492.},
 pages = {1--26},
 title = {Tax Competition, Economic Growth, and Social Welfare},
 year = {2021}
}