Theoretical Analysis of Multinational Firms and Tax Competition

• Project/Area Number: 17K13741
• Research Category: Grant-in-Aid for Young Scientists (B)
• Allocation Type: Multi-year Fund
• Research Field: Economic policy
• Research Institution: Kindai University
• Principal Investigator: Morita Tadashi 近畿大学, 経済学部, 准教授 (50635175)
• Project Period (FY): 2017-04-01 – 2022-03-31
• Project Status: Completed (Fiscal Year 2021)
• Budget Amount: ¥4,160,000 (Direct Cost: ¥3,200,000、Indirect Cost: ¥960,000); Fiscal Year 2020: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2019: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2018: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2017: ¥1,430,000 (Direct Cost: ¥1,100,000、Indirect Cost: ¥330,000)
• Keywords: 租税競争 / 失業 / 多国籍企業 / 賃金格差 / 多地域モデル / 大企業 / 中小企業 / 産業政策 / 法人税 / 国際貿易 / 経済理論 / 経済政策

Outline of Final Research Achievements

This project investigates to compare the corporate tax rate or subsidies for multi-national firms in the competitive equilibrium with theses that the supra-national government determines to maximize the world social welfare level. Two main studies were conducted in this project. One study analyzed the optimal corporate tax rate in the presence of unemployment. This study showed that countries with larger markets impose higher tax rates and that higher production costs decrease the corporate tax rate. The other study analyzed whether governments impose different tax rates or subsidies on home and multinational firms. The study found that imposing lower corporate taxes or subsidies only on multinationals will increase inefficient foreign direct investment. As a result, this study showed that the welfare level in the world is lower than the optimal level.

Academic Significance and Societal Importance of the Research Achievements

一つ目の研究によって、世界的な法人税率を引き下げる潮流に関して、生産費用の増加がその理由の一つであることを理論的に突き止めることができた。そして、二つ目の研究によって、多国籍企業にだけ国内企業よりも安い法人税率を課したり補助金を与えたりすることは望ましくないことを理論的に示すことができた。政府が外国企業にだけ特別税率を下げたり補助金を与えたりすると、必要以上の企業が海外直接投資を行うことになり、社会全体として非効率になってしまう。そこで、国際的に先進諸国は多国籍企業にだけ税金を減免したり補助金を与えたりしないように協調すべきである。

Research Products

• [Int'l Joint Research] University of Denver(米国)
• [Int'l Joint Research] University of Denver(米国)
• [Journal Article] Demographics and competition for capital in political economy (2020)
  • Author(s): Tadashi Morita, Yasuhiro Sato, Kazuhiro Yamamoto
  • Journal Title: International Tax and Public Finance Volume: － Issue: 4 Pages: 865-889
  • DOI: 10.1007/s10797-019-09587-0
  • Peer Reviewed
• [Journal Article] Subsidy competition and imperfect labor markets (2020)
  • Author(s): Morita Tadashi、Sawada Yukiko、Yamamoto Kazuhiro
  • Journal Title: Journal of Public Economic Theory Volume: 22 Issue: 3 Pages: 698-728
  • DOI: 10.1111/jpet.12400
  • Peer Reviewed
• [Journal Article] Corporate Tax Competition in the Presence of Unemployment (2017)
  • Author(s): Tadashi Morita, Yoshiyasu Ono, Yoshitomo Ogawa
  • Journal Title: RIETI Discussion Paper Series Volume: 17-E-118 Pages: 1-22
• [Presentation] Inter- and Intraregional Inequality in a Spatial Economy (2022)
  • Author(s): Tadashi Morita
  • Organizer: Gottinger Workshop
  • Int'l Joint Research
• [Presentation] Market Size, Competition, and Innovation by Big and Small (2020)
  • Author(s): Tadashi Morita
  • Organizer: 日本国際経済学会 関西支部定例研究会
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2019)
  • Author(s): Tadashi Morita
  • Organizer: The Urban Economic Workshop
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2019)
  • Author(s): Tadashi Morita
  • Organizer: Queensland University of Technology
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2019)
  • Author(s): Tadashi Morita
  • Organizer: Asia Pacific Trade Seminars
• [Presentation] Competition with innovation among the big and the small (2019)
  • Author(s): Tadashi Morita
  • Organizer: Kobe University
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2018)
  • Author(s): Tadashi Morita
  • Organizer: Urban Economic Association
  • Int'l Joint Research
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2018)
  • Author(s): Tadashi Morita
  • Organizer: Industrial Organization and Spatial Economics
  • Int'l Joint Research
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2018)
  • Author(s): Tadashi Morita
  • Organizer: European Trade Study Group
  • Int'l Joint Research
• [Presentation] Welfare, Tax Discrimination, and Horizontal Foreign Direct Investment (2018)
  • Author(s): 森田忠士
  • Organizer: 応用地域学会
• [Presentation] Corporate Tax Competition in the Presence of Unemployment (2017)
  • Author(s): Tadashi Morita
  • Organizer: North American Regional Science Council
  • Int'l Joint Research
• [Presentation] Corporate Tax Competition in the Presence of Unemployment (2017)
  • Author(s): Tadashi Morita
  • Organizer: 応用地域学会