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Taxation And Internal Migration—Evidence From The Swiss Census Using Community‐Level Variation In Income Tax Rates

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  • Thomas Liebig
  • Patrick A. Puhani
  • Alfonso Sousa‐Poza
Abstract
ABSTRACT We investigate the relationship between income tax rate variation and internal migration for the unique case of Switzerland, whose system of determining tax rates primarily at the community level results in enough variation to permit analysis of their influence on migration. Specifically, using Swiss census data, we analyze migratory responses to tax rate variations for various groups defined by age, education, and nationality/residence permit. The results suggest that young Swiss college graduates are most sensitive to tax rate differences, but the estimated effects are not large enough to offset the revenue‐increasing effect of a rise in tax rate. The migratory responses of foreigners and other age‐education groups are even smaller, and reverse causation seems negligible.

Suggested Citation

  • Thomas Liebig & Patrick A. Puhani & Alfonso Sousa‐Poza, 2007. "Taxation And Internal Migration—Evidence From The Swiss Census Using Community‐Level Variation In Income Tax Rates," Journal of Regional Science, Wiley Blackwell, vol. 47(4), pages 807-836, October.
    • Handle: RePEc:bla:jregsc:v:47:y:2007:i:4:p:807-836
    DOI: 10.1111/j.1467-9787.2007.00529.x
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    More about this item

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects

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