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Taxes and the Location Decision of Manufacturing Establishments
Author(s) -
Rainey Daniel V.,
McNamara Kevin T.
Publication year - 1999
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.2307/1349973
Subject(s) - incentive , business , property tax , ad valorem tax , tax incentive , labour economics , public economics , economics , double taxation , tax reform , finance , microeconomics
This study examines the impact of local tax differentials on the location of manufacturing firms. The study improves on previous substate location/growth studies in constructing a tax measure that better reflects the tax burden that firms are likely to face. The results of the study indicate that firms tend to avoid counties that have relatively high property tax rates. These findings suggest that tax relief incentives can be an important component of a county's industrial recruitment program.