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In this paper the changes in trade patterns introduced by the Canada-United States Free Trade Agreement are examined. Variation in the extent of tariff liberalization under the agreement is used to identify the impact of tariff liberalization on the growth of trade both with member countries and non-member countries. Data at the commodity level are used, and the results indicate that the Canada-United States Free Trade Agreement had substantial trade creation effects, with little evidence of trade diversion. JEL Classification: F13, F14

This paper studies variation among OECD countries in the size of corporate income tax revenues relative to GDP over the time period 1979–2002. A decomposition explains such variation as a function of the statutory tax rate, the breadth of the tax base, corporate profitability, and the share of the corporate sector in GDP. Empirical results indicate a parabolic relationship between tax rates and revenues, implying a revenue-maximizing corporate income tax rate of 33% for the whole sample. This revenue-maximizing rate is found to decrease as economies are smaller and more integrated with the world economy. Copyright Springer Science + Business Media, LLC 2007Corporate income taxation, Corporate income tax revenues, World tax competition, Multinational corporations,

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Using two-panel data sets on the operations of U.S. multinational firms abroad and the operations of foreign multinational firms in the United States, this article examines the empirical relationship between international trade and multinational acti¨ity. The e¨idence supports the conclusion that multinational acti¨ity and trade are complementary acti¨ities, particularly multinational acti¨ity and intrafirm trade. This empirical result is consistent with the theoretical reasons one might expect a complementary relationship between the two acti¨ities and is also robust to different Ž . approaches and specifications. JEL F23