An unbalanced spatial panel data approach to US state tax competition

This paper assesses spatial competition in excise taxation among US states over the time period 1975-1999. We estimate the slope and shifters of the tax reaction curves using spatial panel data methods recently proposed by Kapoor et al. (in press) [Kapoor, M., Kelejian, H.H., Prucha, I.R., in press. Panel data models with spatially correlated error components. J. Econ.].