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Quantitative Implications of the Home Bias: Foreign Underinvestment, Domestic Oversaving and Corrective Taxation

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  • Razin, A.
  • Sadka, E.
  • Yuen, C.W.

Abstract

In this paper, we have emphasized information problems which lead to home bias and insufficient amounts of capital inflows.

Suggested Citation

  • Razin, A. & Sadka, E. & Yuen, C.W., 1997. "Quantitative Implications of the Home Bias: Foreign Underinvestment, Domestic Oversaving and Corrective Taxation," Papers 33-97, Tel Aviv.
    • Handle: RePEc:fth:teavfo:33-97
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    References listed on IDEAS

    as
    1. Razin, Assaf & Sadka, Efraim & Yuen, Chi-Wa, 1998. "A pecking order of capital inflows and international tax principles," Journal of International Economics, Elsevier, vol. 44(1), pages 45-68, February.
    2. Gordon, Roger H & Bovenberg, A Lans, 1996. "Why Is Capital So Immobile Internationally? Possible Explanations and Implications for Capital Income Taxation," American Economic Review, American Economic Association, vol. 86(5), pages 1057-1075, December.
    3. Gordon, Roger H. & Varian, Hal R., 1989. "Taxation of asset income in the presence of a world securities market," Journal of International Economics, Elsevier, vol. 26(3-4), pages 205-226, May.
    4. Jacob Frenkel & Assaf Razin & Efraim Sadka, 1991. "International Taxation in an Integrated World," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061430, April.
    5. Huizinga, Harry & Nielsen, Soren Bo, 1997. "Capital income and profit taxation with foreign ownership of firms," Journal of International Economics, Elsevier, vol. 42(1-2), pages 149-165, February.
    6. Jonathan Eaton & Mark Gersovitz, 1987. "Country Risk and the Organization of International Capital Transfer," NBER Working Papers 2204, National Bureau of Economic Research, Inc.
    7. Razin, Assaf & Sadka, Efraim & Yuen, Chi-WA, 1997. "Channelling Domestic Savings Into Productive Investment Under Asymmetric Information: The Essential Role of Foreign Direct Investment," Foerder Institute for Economic Research Working Papers 275630, Tel-Aviv University > Foerder Institute for Economic Research.
    8. Paul A. Samuelson, 1956. "Social Indifference Curves," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 1-22.
    9. Razin, Assaf & Sadka, Efraim & Yuen, Chi-WA, 1997. "Channelling Domestic Savings Into Productive Investment Under Asymmetric Information: The Essential Role of Foreign Direct Investment," Foerder Institute for Economic Research Working Papers 275630, Tel-Aviv University > Foerder Institute for Economic Research.
    10. Diamond, Peter A & Mirrlees, James A, 1971. "Optimal Taxation and Public Production: I--Production Efficiency," American Economic Review, American Economic Association, vol. 61(1), pages 8-27, March.
    11. Peter A. Diamond & J. A. Mirrlees, 1968. "Optimal Taxation and Public Production," Working papers 22, Massachusetts Institute of Technology (MIT), Department of Economics.
    12. Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
    13. Diamond, Peter A & Mirrlees, James A, 1971. "Optimal Taxation and Public Production II: Tax Rules," American Economic Review, American Economic Association, vol. 61(3), pages 261-278, June.
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    Cited by:

    1. Mishra, Anil V. & Ratti, Ronald A., 2013. "Home bias and cross border taxation," Journal of International Money and Finance, Elsevier, vol. 32(C), pages 169-193.

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    More about this item

    Keywords

    FOREIGN INVESTMENTS ; CAPITAL MARKET ; TAX POLICY ; INFORMATION;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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