In an seminal but neglected paper, Bertil Ohlin stressed that taxation and public expenditure can significantly alter the composition and direction of trade.1 Ohlin analysed company taxation, sales taxation, and other levies in the context of factor immobility. Professor Philip has now broadened the discussion by examining the impact of taxation and public expenditure when labour and capital are free to move from country to country.
KeywordsDual Principle Commodity Trade Factor Service Origin Principle Factor Owner
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- 1.Bertil Ohlin, ‘Taxation and Foreign Trade’, Appendix II in International Labour Office, Social Aspects of European Economic Cooperation, report by a Group of Experts, Geneva (Switzerland, 1956).Google Scholar
- 2.My remarks draw extensively on a paper by M. B. Krauss and G. C. Hufbauer, ‘Border Tax Adjustments on Commodities and Income’, unpublished manuscript (July, 1976).Google Scholar
- 6.More recent treatments include: Dieter Biehl, Ausfuhrland-Pr inzip Einfuhrland-Prinzip und Germeinsamer-Markt-Prinzip, Carl Heymanns Verlag KG (Koln, 1969).Google Scholar
- Harry Johnson and Mel Krauss, ‘Border Taxes, Border Tax Adjustments, Comparative Advantage, and the Balance of Payments’, Canadian Journal of Economics (November, 1970).Google Scholar
- James E. Meade, ‘A Note of Border Tax Adjustments’, Journal of Political Economy (September/October, 1974).Google Scholar
- 17.English translations of the classic essays may be found in R. A. Musgrave and A. T. Peacock, editors, Classics in the Theory of Public Finance (Macmillan, 1958).Google Scholar
- 18.C. M. Tiebout, ‘A Pure Theory of Local Expenditures’, Journal of Political Economy (October, 1956).Google Scholar