TAX BURDEN AND ECONOMIC COMPLEXITY: AN ANALYSIS OF G20 COUNTRIES
DOI:
https://doi.org/10.56238/revgeov17n1-174Keywords:
Tax Burden, Economic Complexity, G20Abstract
The study examined the relationship between tax burden and economic complexity in G20 countries, aiming to address the gap in research that has not directly tested this association. While prior studies link tax burden to per capita income and economic complexity to inequality and income, the interaction between the first two factors remains unexplored. A quantitative methodology was employed, estimating a panel data model using tax burden, economic complexity, per capita income, innovation, and inequality data from G20 countries between 2012 and 2021. Results revealed a positive and statistically significant relationship between economic complexity, per capita income, and tax burden, corroborating previous findings but with the distinction of using aggregated national-level data focused on globally significant economies. Hypotheses linking innovation and income inequality to tax burden were not confirmed. The research contributes to the literature by validating the relationship between tax burden and economic complexity, incorporating variables and national proxies not previously analyzed together. The findings may inform public policies for economic development, particularly those aimed at diversification through industrialization, which also impact tax systems. Furthermore, the study expands empirical research on the assumptions of economic complexity theory, broadening its applicability to other contexts. Thus, it stands out not only for confirming theoretical relationships but also for its methodological focus on central economies in the global landscape, offering insights for debates on taxation and structural growth strategies.
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