6533b85ffe1ef96bd12c1943

RESEARCH PRODUCT

The Effects of Taxation on Migration: Some Evidence for the ASEAN and APEC Economies

Iris ClausIris ClausMichael DörsamEdda Claus

subject

Economic cooperationLabour economicsLabor mobilityStylized factGovernmentSecondary educationHigher educationEconomybusiness.industryEconomicsbusinessEmpirical evidenceSoutheast asian

description

This paper investigates the effects of taxation on migration. It develops a stylized, two-country model to examine the impact of taxes on labor mobility. The theoretical predictions that taxes affect migration decisions and that educated workers are more responsive to taxation are supported by some empirical evidence for the economies of the Association of Southeast Asian Nations and the Asia-Pacific Economic Cooperation. The empirical application also shows that average tax rates have a larger impact on migration choices than marginal rates. Average tax rates are most important for migrants with secondary education, while marginal rates have a greater influence on the decisions of migrants with tertiary education compared to secondary-educated migrants. The finding that taxation affects migration decisions, in particular of educated migrants, has important policy implications.

yearjournalcountryeditionlanguage
2010-01-01SSRN Electronic Journal
https://doi.org/10.2139/ssrn.1729023