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.].