Models of tax competition usually assume a single-period framework. This paper sets up a repeated interactions model of tax competition and establishes conditions under which fiscal policy harmonization can result from repeated interactions between governments. It is shown that fiscal policy harmonization cannot prevail when regional asymmetries are too strong. In such a case, the only way to achieve fiscal policy harmonization is to set up a central fiscal authority.

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3This paper examines a situation where a decision-maker determines the appropriate 4 compensation that should be implemented for a given ecological damage. The compen-