Tax: an international political economy reading list

It’s been a while, but I’m back. One thing I did while the blog was silent was give a couple of lectures on tax and offshore, as part of broader courses I taught on international political economy and finance. In doing so I realised that the literature on international tax relations is not as sparse as it sometimes feels. Here is a selection of pieces that I included on my reading list for students. This should be a place to start if you’re a political scientist interested in learning about international tax, or from an economics or law background seeking different perspectives; if you’re from business, government or campaigning, see if these papers ring true to you. I have stuck strictly to publications in academic journals and academic books, but if you don’t have access to a university library, I’ve included links to any versions of the papers that are freely available.

This will be a living page, so please get in touch to point out anything I have missed, especially if you wrote it! The aim here is not to be comprehensive, but to provide an entry point. Apart from the law articles at the end, this is a disappointingly pale male list, and I hope over time to find some articles from a more diverse background!

Introductory articles

Gabriel Zucman, 2014. Taxing across Borders: Tracking Personal Wealth and Corporate Profits. Journal of Economic Perspectives 28(4): 121–148

The first piece on this list is actually by an economist. I like it because as well as bringing new data to the discussion about avoidance and evasion, it also explains the way the international tax system works pretty well and is a good entry level reading. I set it for my undergraduates in a general course on international political economy.

Thomas Rixen, 2011. From double tax avoidance to tax competition: Explaining the institutional trajectory of international tax governance. Review of International Political Economy 18(2): 197-227.

Rixen is probably the best known scholar writing on international tax in the rationalist, liberal institutionalist tradition, and this article encapsulates his powerful argument about path dependence in the development of the international tax regime: a system developed to tackle double taxation doesn’t have the institutional properties needed to handle harmful tax competition.

Jason Sharman, 2010. Offshore and the New International Political Economy. Review of International Political Economy 17(1): 1-19

This was a core reading for my postgraduate students, who enjoyed getting their teeth into it. The article sets out some of the main ways in which offshore is used in the global political economy – beyond just tax – organised around the concept of ‘calculated ambiguity’.

Ronen Palan, 1998. Trying to Have Your Cake and Eating It: How and Why the State System Has Created Offshore. International Studies Quarterly 2(4): 625–643

The oldest reading on the list, predating even the harmful tax practices project. It’s one of two articles by Ronen Palan that establish his concept of ‘commercialised sovereignty’, wrapping it up in an analysis of the political economy of the state under globalisation that helps explain why the state acts as it does. This was the other core reading for my postgraduates, because it explains the development of offshore within the evolution of the financial system more broadly.

Tax havens, coercion and information exchange

Lukas Hackelberg, 2016. Coercion in international tax cooperation: identifying the prerequisites for sanction threats by a great power. Review of International Political Economy 23(3): 511-541 

I came across Hackelberg’s work recently, and I think he does a great job of applying some classic rationalist international political economy theories to international tax. This article looks in particular at the nature of US financial hegemony in terms of internal and external factors, through the lens of the fight against tax havens.

Richard Eccleston and Richard Woodward, 2014. Pathologies in International Policy Transfer: The Case of the OECD Tax Transparency Initiative. Journal of Comparative Policy Analysis 16(3): 216-229

OECD-bashing is a favourite hobby of international tax watchers, right through from NGO campaigners to the offshore industry. But those engaging in the practice rarely make their analysis of how the OECD works rigorous or explicit, whereas this paper tries to do so through the lens of bureaucratic politics.

Alex Cobham, Petr Janský and Markus Meinzer, 2015. The Financial Secrecy Index: Shedding new light on the geography of secrecy. Economic Geography 91(3): 281-303.

The financial secrecy index is a political intervention by Tax Justice Network, and as such it will always attract strong reactions. This is a peer-reviewed paper (the link is to a working paper version of the journal article) that sets it in context and explains the methodology. The discussion of defining ‘tax havens’ is essential background, and it would be a good exercise for students to review and critique the authors’ approach to developing the index.

Jason Sharman, 2012. Canaries in the Coal Mine: Tax Havens, the Decline of the West and the Rise of the Rest. New Political Economy, 17(4), pp.493-513

This is another good piece for students wanting to relate offshore to broader themes in international political economy. It divides offshore financial centres into five groups, and discusses how they have positioned themselves in the shifting terrain of the 21st century economy.

Michael C. Webb, 2004. Defining the Boundaries of Legitimate State Practice: Norms, Transnational Actors and the OECD’s Project on Harmful Tax Competition. Review of International Political Economy 11(4): 787-827

This article predates Jason Sharman’s definitive book on this topic. Its story, which considers the OECD as an organisation and the role played by particular interest groups, can very much be set in contrast to Lukas Hackelberg’s state-centred discussion.

Multinational corporate taxation

Leonard Seabrooke and Duncan Wigan, 2015. Powering ideas through expertise: professionals in global tax battles. Journal of European Public Policy 26(3): 357-374

In contrast to the rationalist, state-centred view of international tax bargaining employed by Rixen, Hackelberg and others, this article shifts focus to the role of professional expertise in propounding ideas. It also focuses on country-by-country reporting, which makes it one of the few articles so far to engage in depth with the campaigning around corporate tax avoidance.

Stephen Bell and Andrew Hindmoor, 2013. The Structural Power of Business and the Power of Ideas: The Strange Case of the Australian Mining Tax. New Political Economy 19(3): 470–486.

This paper questions whether the pressures created by tax competition are a real thing, arguing that it’s how much people believe capital will respond to tax competition that matters, not the extent to which it really will.

Philipp Genschel and Peter Schwarz, 2011. Tax competition: a literature review. Socio-economic Review 9(2): 339-370

I haven’t included a great deal of literature on tax competition in this list, because that’s a more familiar evidence base, but this is a great review that considers the political science and economics literature, as it was in 2011 at least.

Roland Paris, 2003. The Globalization of Taxation? Electronic Commerce and the Transformation of the State. International Studies Quarterly 47(2): 153–182

An old article that came to my attention when a student dug it out in an essay. Like Palan’s piece, also in ISQ, this paper draws out implications for the state from the challenges of globalisation and international taxation. It also has the merit that we can compare its speculation against what has happened since 2003.

Legal scholarship that crosses into international relations

Sol Picciotto, 2015. Indeterminacy, Complexity, Technocracy and the Reform of International Corporate Taxation. Social and Legal Studies 24(2): 165–184.

This article takes a Bourdieusian perspective on the relationship between power and expertise, providing a fresh view of the politics of international corporate tax. It makes a careful, compelling argument that can be read in parallel with Seabrooke and Wigan’s paper above.

Itai Grinberg, 2015. Breaking BEPS: The New International Tax Diplomacy. Georgetown law working paper.

Grinberg, like Lukas Hackelberg, is doing interesting work drawing analogies across from other, more intensively studied areas of international financial law, in particular the Basel process. This working paper is a great summary of where a research agenda based on this analogy might go.

Allison Christians, 2012. How Nations Share. Indiana Law Journal 87(4): 1407-1452.

This is my go-to piece analysing the trajectory of legalisation and judicialisation in international tax disputes. While work on the division of the tax base in international relations has tended to be preoccupied by the conclusion of tax treaties, this is one of the few pieces to examine how they are applied and used in practice.

Diane Ring, 2010. Who is Making International Tax Policy? International Organizations as Power Players in a High Stakes World. Fordham International Law Journal 33(3): 649-722

Diane Ring is probably the lawyer who has gone furthest into international relations literature. She uses it here to discuss institutional arrangements for international tax cooperation, focusing on the different actors involved and how they engage with each other.

Eduardo Baistrocchi, 2008. The Use and Interpretation of Tax Treaties in the Emerging World: Theory and Implications. British Tax Review 28(4):352-390.

Love it or hate it, game theory is a big part of international relations. These last two articles are good examples of legal scholars using it in their own work to examine the relationship between developed and developing countries in the international tax regime. This paper analyses how the structural characteristics of the international tax system shape incentives for developing countries to conclude and apply tax treaties.

Tsilly Dagan, 2000. The Tax Treaties Myth. New York University Journal of International Law and Politics 32:939-1175

This article has a kind of totemic status within the critical legal literature on tax treaties, and it’s the starting point for much of my own work. It all comes down to a bit of game theory that would not be out of place in an international relations article, which questions the prevailing logic behind tax treaties. While Baistrocchi, above, focuses on the system level, this paper concentrates on the bilateral relationship a developed and developing country.

Books and journal special issues

  • Revenue Mobilization in the Developing World: Changes, Challenges and Chances. 2016. Review of International Political Economy, 23(2).
  • Peter Dietsch, and Thomas Rixen (eds), 2016. Global Tax Governance : What is wrong with it and how to fix it. Colchester: ECPR Press.
  • Tasha Fairfield, 2015. Private wealth and public revenue in Latin America : business power and tax politics. New York: Cambridge University Press.
  • Jeremy Leaman and Attiya Waris, 2013. Tax Justice and the Political Economy of Global Capitalism, 1945 to the Present. New York: Berghahn
  • Ronen Palan, Richard Murphy and Christian Chavagneux, 2013. Tax havens: How globalization really works. Cornell University Press.
  • Richard Eccleston, 2012. The Dynamics of Global Economic Governance: The OECD, the Financial Crisis and the Politics of International Tax Cooperation. Cheltenham: Edward Elgar.
  • Thomas Rixen, 2008. The political economy of international tax governance. New York: Palgrave Macmillan.
  • Reuven Avi-Yonah, 2007. International Tax as International Law. New York: Cambridge University Press.
  • Jason Sharman, 2006. Havens in a Storm: The Global Struggle for Tax Regulation. Ithaca: Cornell University Press.
  • Ronen Palan, 2003. The offshore world : sovereign markets, virtual places, and nomad millionaires. Ithaca: Cornell University Press.
  • Sol Picciotto, 1992. International business taxation : a study in the internationalization of business regulation. London: Weidenfeld & Nicolson.