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Double Taxation Treaties’ Impact on Intermediate Trade

Braunschweig, Anna LU (2014) NEKN01 20142
Department of Economics
Abstract (Swedish)
The aim of this thesis is to investigate double taxation treaties impact on intermediate trade. Based on a panel data sample of five partner countries and 39 reporter countries over the period 1990-2012, the impact of signing DTTs on imports of intermediate trade in goods between two countries is analysed through a Gravity model. The main results show that DTT signing is associated with an increase in imports of intermediate goods. The baseline regression is estimated with OLS using fixed effects with logged values of intermediate trade as dependent variable, a bilateral mass variable of countries’ GDP, a dummy variable with unity 1 when signing a DTT and a distance variable, as explanatory ones. However, due to a large fraction of zero... (More)
The aim of this thesis is to investigate double taxation treaties impact on intermediate trade. Based on a panel data sample of five partner countries and 39 reporter countries over the period 1990-2012, the impact of signing DTTs on imports of intermediate trade in goods between two countries is analysed through a Gravity model. The main results show that DTT signing is associated with an increase in imports of intermediate goods. The baseline regression is estimated with OLS using fixed effects with logged values of intermediate trade as dependent variable, a bilateral mass variable of countries’ GDP, a dummy variable with unity 1 when signing a DTT and a distance variable, as explanatory ones. However, due to a large fraction of zero trade flows in the sample, the magnitude of the effect is hard to determine. To check for robustness when dealing with zero trade flows, methods for sample selection bias have been estimated. Despite this, signing DTTs appears to have a positive impact on intermediate trade. The findings further reveal the importance for future research to investigate how DTTs are affecting intermediate trade in the presents of selection bias. (Less)
Please use this url to cite or link to this publication:
author
Braunschweig, Anna LU
supervisor
organization
course
NEKN01 20142
year
type
H1 - Master's Degree (One Year)
subject
keywords
Double taxation treaty, DTT, Intermediate trade, Gravity model, Fixed effects, Heckman, Poisson regression
language
English
id
4780372
date added to LUP
2014-11-18 13:30:33
date last changed
2014-11-18 13:30:33
@misc{4780372,
  abstract     = {{The aim of this thesis is to investigate double taxation treaties impact on intermediate trade. Based on a panel data sample of five partner countries and 39 reporter countries over the period 1990-2012, the impact of signing DTTs on imports of intermediate trade in goods between two countries is analysed through a Gravity model. The main results show that DTT signing is associated with an increase in imports of intermediate goods. The baseline regression is estimated with OLS using fixed effects with logged values of intermediate trade as dependent variable, a bilateral mass variable of countries’ GDP, a dummy variable with unity 1 when signing a DTT and a distance variable, as explanatory ones. However, due to a large fraction of zero trade flows in the sample, the magnitude of the effect is hard to determine. To check for robustness when dealing with zero trade flows, methods for sample selection bias have been estimated. Despite this, signing DTTs appears to have a positive impact on intermediate trade. The findings further reveal the importance for future research to investigate how DTTs are affecting intermediate trade in the presents of selection bias.}},
  author       = {{Braunschweig, Anna}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Double Taxation Treaties’ Impact on Intermediate Trade}},
  year         = {{2014}},
}