NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Do Tax Havens Flourish?

James R. Hines Jr.

NBER Working Paper No. 10936
Issued in November 2004
NBER Program(s):   IFM   PE

Tax haven countries offer foreign investors low tax rates and other tax features designed to attract investment and thereby stimulate economic activity. Major tax havens have less than one percent of the world's population (outside the United States), and 2.3 percent of world GDP, but host 5.7 percent of the foreign employment and 8.4 percent of foreign property, plant and equipment of American firms. Per capita real GDP in tax haven countries grew at an average annual rate of 3.3 percent between 1982 and 1999, which compares favorably to the world average of 1.4 percent. Tax haven governments appear to be adequately funded, with an average 25 percent ratio of government to GDP that exceeds the 20 percent ratio for the world as a whole, though the small populations and relative affluence of these countries would normally be associated with even larger governments. Whether the economic prosperity of tax haven countries comes at the expense of higher tax countries is unclear, though recent research suggests that tax haven activity stimulates investment in nearby high-tax countries.

download in pdf format
   (208 K)

email paper

This paper is available as PDF (208 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w10936

Published: Do Tax Havens Flourish?, James R. Hines Jr.. in Tax Policy and the Economy, Volume 19, Poterba. 2005

Users who downloaded this paper also downloaded these:
Hines Do Tax Havens Flourish?
Desai, Foley, and Hines w10806 Economic Effects of Regional Tax Havens
Hines and Rice w3477 Fiscal Paradise: Foreign Tax Havens and American Business
Slemrod and Wilson w12225 Tax Competition With Parasitic Tax Havens
Dharmapala and Hines w12802 Which Countries Become Tax Havens?
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us