International asset trade, capital income taxation, and specialization patterns

Koichi Futagami, Akihiko Kaneko, Yoshiyasu Ono, Akihisa Shibata

Research output: Contribution to journalArticle

Abstract

This paper constructs a small economy version of dynamic Heckscher-Ohlin models with overlapping generations and analyzes effects of capital income taxation on the specialization pattern of the country. It is shown that once international asset trade is allowed, in the presence of international technological asymmetries, a small country eventually leads to perfect specialization in our overlapping generations model. It is also shown that the residence-based tax has no effect on the specialization pattern while the source-based tax has a negative effect on capital accumulation and thereby it can affect the specialization pattern of the small country.

Original languageEnglish
Pages (from-to)743-763
Number of pages21
JournalJournal of Public Economic Theory
Volume10
Issue number5
DOIs
Publication statusPublished - 2008 Oct
Externally publishedYes

Fingerprint

taxation
specialization
assets
income
taxes
capital accumulation
asymmetry
economy
Assets
Capital income taxation
Tax
Small countries

ASJC Scopus subject areas

  • Economics and Econometrics
  • Finance
  • Sociology and Political Science

Cite this

International asset trade, capital income taxation, and specialization patterns. / Futagami, Koichi; Kaneko, Akihiko; Ono, Yoshiyasu; Shibata, Akihisa.

In: Journal of Public Economic Theory, Vol. 10, No. 5, 10.2008, p. 743-763.

Research output: Contribution to journalArticle

Futagami, Koichi ; Kaneko, Akihiko ; Ono, Yoshiyasu ; Shibata, Akihisa. / International asset trade, capital income taxation, and specialization patterns. In: Journal of Public Economic Theory. 2008 ; Vol. 10, No. 5. pp. 743-763.
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