Protection and Foreign Investment

W. Max Corden

in Trade Policy and Economic Welfare

Second edition

Published in print February 1997 | ISBN: 9780198775348
Published online November 2003 | e-ISBN: 9780191715471 | DOI:
 Protection and Foreign Investment

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First, the direct and indirect effects of protection on capital inflow are presented. Secondly, the principles for taxing foreign capital are reviewed. Then, tariffs are shown in some cases to be second‐best taxes or subsidies on foreign capital. Finally, it is shown that transfer pricing by vertically integrated multinationals has implications for tax and tariff policies.

Keywords: capital inflow; foreign investment; multinationals; protection; tariffs; transfer pricing

Chapter.  9784 words.  Illustrated.

Subjects: International Economics

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