Max Planck Institute for Tax Law and Public Finance

The crisis in Ukraine has driven up energy prices, obscuring a dilemma that we’re likely to face in the near future - the use of fossil fuels will become more attractive again for countries that cannot afford or do not want to make the transition to renewable energies. Against this backdrop, Kai A. Konrad from the Max Planck Institute for Tax Law and Public Finance advocates speeding up the search for alternative uses, starting now.

Informing people about the strong positive consensus among doctors persistently leads to increases in Covid-19 vaccinations

Whistleblowing perturbs the tax haven business, an empirical study found

A study shows: Appropriate rules can increase compliance in groups

An economic study shows that dishonest people consciously choose situations in which they can cheat

The crisis in Ukraine has driven up energy prices, obscuring a dilemma that we’re likely to face in the near future: if many countries are increasingly able to generate energy without using oil and natural gas, the price of these commodities will fall. This means that the use of fossil fuels will become more attractive again for countries that cannot afford or do not want to make the transition to renewable energies. Against this backdrop, our author advocates speeding up the search for alternative uses, starting now.

Despite the fact that social inequities are increasing, no broad alliance for a greater redistribution of income and wealth has emerged in democratic countries. Lisa Windsteiger, Andrea Martinangeli and Marco Serena are conducting research into the reasons for this at the Max Planck Institute for Tax Law and Public Finance. They are also studying the ways in which immigration and poverty influence people’s attitudes towards state intervention.

International corporations such as Apple, Starbucks and Amazon have for years successfully avoided paying tax on their corporate profits. Aided by tax competition between nations, they shift their money to countries that have low tax rates and that guarantee that only domestic profits will be taxed. Our author explains why it is far from easy for the international community to counter these tricks.

Greece, Ireland and Portugal avoided bankruptcy only due to a bailout by the European Union and the International Monetary Fund. The stability of the European Monetary Union hangs in the balance.

Oil export embargoes have hardly any sanctioning effect on autocratically governed countries with large oil reserves and an environment with functioning global oil and financial markets. Oil embargoes cause damage to the sanctioned governments if the autocrats‘ future power situation is uncertain. There is a sanction effect under these conditions, which is greater if there are no concurrent sanctions on the financial markets: sanctions on the financial markets and sanctions through oil embargoes prevent each other‘s effectiveness.

To achieve the goal of carbon neutrality, the European Union is placing large parts of its legal system under the guiding principle of sustainability. A recent example is the new Corporate Sustainability Reporting Directive. With this new legislative act, the European Commission is changing the scope and nature of sustainability reporting by companies. It gives non-financial reporting a similar status to financial ones, significantly expands the group of companies affected and tightens up the reporting requirements. And, more importantly, it also creates new standards of corporate governance.

Cheating to gain an economic advantage can be tempting. Wirecard’s accounting fraud or the Cum-Ex tax evasion scam are just some of the more recent prominent economic scandals. But dishonest behaviour also plays a role in everyday life. Travelling without a subway ticket is just as much a part of it as showing fake test and vaccination certificates in times of Corona. What motivates people to behave honestly or dishonestly has been investigated in a series of experimental economics studies by economists at the Max Planck Institute for Tax Law and Public Finance.

Recent calls for „more justice“ in international taxation prompt the question: what does that mean, in principle, and what would it require in practice? International taxation is supposed to go hand in hand with value creation, but that does not tell us how to weigh different contributions to global value chains. Moreover, the recent international tax justice debate must be sensitive to a parallel debate in political philosophy that centers on the proper scope of principles of distributive justice.

In general, both men and women perform better in competitive situations. However, when women are in a state of elevated stress, competition has the opposite effect and leads to worse performance. As a consequence, women under stress increasingly shy away from competition, according to a recently published study by economic researchers. Their results could help to explain why women are underrepresented in high-paid jobs and in leadership positions. The results also have implications for efficient management practices, including hiring and performance incentives.