Centralized vs. De-centralized Multinationals and Taxes

Søren Bo Nielsen, Pascalis Raimondos-Møller, Guttorm Schjelderup

Research output: Working paperResearch

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The paper examines how country tax differences affect a multinational enterprise's choice to centralize or de-centralize its decision structure. Within a simple model that emphasizes the multiple conflicting roles of transfer prices in MNEs – here, as a strategic pre-commitment device and a tax manipulation instrument –, we show that (de-)centralized decisions are more profitable when tax differentials are (small) large.
Original languageEnglish
Place of PublicationFrederiksberg
PublisherCopenhagen Business School, CBS
Number of pages17
Publication statusPublished - 2005
SeriesWorking Paper / Department of Economics. Copenhagen Business School


  • Centralized vs. de-centralized decisions
  • Taxes
  • MNEs

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