TY  - JOUR
AU  - Razin,Assaf
AU  - Yuen,Chi-Wa
TI  - Convergence in Growth Rates: The Role of Capital Mobility and International Taxation
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4214
PY  - 1994
Y2  - August 1994
UR  - http://www.nber.org/papers/w4214
L1  - http://www.nber.org/papers/w4214.pdf
N1  - Author contact info:
Assaf Razin
Department of Economics
Cornell University
Uris 422
Ithaca, NY 14853
Tel: 607/255-9625
Fax: 607/255-2818
E-Mail: ar256@cornell.edu

Chi-wa Yuen
University of Hong Kong
E-Mail: cwyuen@ust.hk
AB  - We consider the role of capital mobility and international taxation. In explaining the observed diversity in long-term growth rates. Our major finding is that, under capital mobility, international differences in taxes will not matter for total growth differentials. Policy differences have a role to play in per capita growth differentials, however, when they lead to a divergence in the after-tax rates of return on capital across countries, as when the residence principle is adopted universally. When this is the case, how tax differences affect the growth rates of population and human capital will depend on the relative preference of the individual household towards these two engines of growth. Optimal tax policies are found to be growth-equalizing with and without policy coordination.
ER  -