The authors construct a tax competition model in which local governments finance business public services with either a source-based tax on mobile capital, such as a property tax, or a tax on production, such as an origin-based value added tax, and then assess which of the two tax instruments is more efficient.
Special drawing rights (SDRs) should become a more relevant instrument of international monetary cooperation. This requires transforming them into a pure reserve asset and the International Monetary Fund into a fully SDR-funded institution.