New Insights into the Relationship Between Taxation and Trade

Client/Funding Institution

Anniversary Fund of the Oesterreichische Nationalbank


The research project uses panel data techniques to empirically explore the relationship between taxation and trade. The main questions of interest focus on the impact of corporate income taxation and employers’ social security contributions on trade dynamics, including value-added trade in the context of global value chains. The analysis disentangles the demand-driven impacts on trade from the effects of profit shifting through transfer-pricing by multinational corporations. The project contributes to the policy discussions focusing on fiscal devaluation, competitiveness and factors shaping trade and current account imbalances.


May 2020 - September 2021

wiiw team Leader

Amat Adarov

wiiw Staff

Birgit Buschbom, Mario Holzner, Branimir Jovanović, Sandor Richter, Monika Schwarzhappel


Keywords: corporate income taxation, social security contributions, fiscal devaluation, international trade, value-added trade, profit shifting

Countries covered: non specific

Research Areas: Macroeconomic Analysis and Policy, International Trade, Competitiveness and FDI