Globalisation and Developing Countries - a Shrinking Tax Base?

Aizenman, Joshua; Jinjarak, Yothin

Abstract

This paper evaluates the impact of globalisation on tax bases of countries at varying stages of development. We see globalisation as a process that induces countries to embrace greater trade and financial integration. This in turn should shift their tax revenue from 'easy to collect' taxes (tariffs and seigniorage) towards 'hard to collect' taxes (value added and income taxes). We find that trade and financial openness have a positive association with the 'hard to collect' taxes, and a negative association with the easy to collect taxes.

Citation

Aizenman, J., & Jinjarak, Y. (2009). Globalisation and Developing Countries - a Shrinking Tax Base?. The Journal of Development Studies, 45(5), 653-671. https://doi.org/10.1080/00220380802582338

• Journal Article Type: Article
• Publication Date: Jan 1, 2009
• Deposit Date: Aug 25, 2010
• Publicly Available Date: Mar 10, 2025
• Print ISSN: 0022-0388
• Electronic ISSN: 1743-9140
• Publisher: Taylor and Francis Group
• Peer Reviewed: Peer Reviewed
• Volume: 45
• Issue: 5
• Pages: 653-671
• DOI: https://doi.org/10.1080/00220380802582338