چکیده:
Previous empirical studies have shown that left-wing governments are commonly expected to be associated with lower interest rates and higher tax rates on capital than their rightist counterparts. The importance of interest rates in shaping the variation in tax policies of OECD countries, where they have been dominated by leftist governments, offers an interesting topic for research. Using data for up to 20 OECD countries in the period of 1966-2000, this paper tries to investigate a hypothesis that challenges the partisan theories of economic growth. We argue that the strategic nature of tax competition is not the sole factor in determining a country’s choice of taxation policy, and that other factors, notably interest rates, play an important role as well. We find that left-wing governments tend to lower capital taxes as a consequence of increased interest rates, which is consistent with the predictions of international tax competition theories, but in contrast to the partisan theories of economic growth presented in this paper
خلاصه ماشینی:
"Although much of the recent literature in political science has explored the political economic determinants of capital taxation, such as the consequences of economic openness on a government’s choice of taxation policy (Jensen 2012; Garrett and Mitchell 2001; Swank and Steinmo 2000; Swank 1998 and 2002), diffusion of capital tax policy across borders (Jensen and Lindstaedt 2012; Cao 2010; Franzese and Hays 2008) and the political and institutional constraints on capital taxation (Pluemper, Troeger and Winner 2009; Basinger and Hallerberg 2004; Hays 2003), the effect of monetary policy on capital taxation and, in particular, the impact of interest rates, have been widely neglected in the comparative political economy literature.
We employ Franzese and Hays (2008) proposed method for estimating, the Spatio-Temporal Autoregressive (STAR) model, which can be written in the following form:1 ௧ߝ ௧ܹ߬ߩ ߚ௧ൌ ߮߬௧ିଵ ܺ௧߬ Where ߬, the dependent variable, denotes average effective tax rates on capital, and is an NT×1 vector of observations stacked by unit over time.
The OECD panel includes Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, the United Kingdom and the United States.
While countries like Australia, Denmark, Finland, Ireland, Italy, New Zealand, Norway, Portugal, Spain, Sweden and the United Kingdom had high levels of interest rates, those displayed by countries such as Austria, Belgium, Canada, France, Germany, the Netherlands, Switzerland and the United States were relatively low."