Proceedings of Paris Economics, Finance and Business Conference
13 - 15 April 2015, Crowne Plaza Hotel Republique, Paris, France, ISBN: 978-1-922069-73-3
Taxes, Procedures and Direct Investments: A Country
Comparative Consideration
Mete Dibo*
Nobel Prize recipient economist Douglass Cecil North states that institutions
determine the rules of the game being played in a society. These rules that made by
people restricts and regulates the interaction between individuals. Institutional
restrictions describe prohibited activities that performed by individuals and sometimes
determine the conditions under which individuals are allowed to engage in certain
activities.
There are considerable differences among countries in the way that economic and
political life is organized. There is some evidence that these differences effects
countries economic performance. An economy with an efficient bureaucracy and rules
of governance can improve living standards, support growth and shared welfare.
These rules can highlight people’s entrepreneurial and creative capacities. It can also
make it easier the creation of an atmosphere for more effective economic policies.
This is a fact that investors want to make investment in countries where market
entrants is easier and bureaucratic processes are shorter. World Bank Group’s Doing
Business reports ranking economies on the ease of doing business and aims to
provide a table with a simple ordinal ranking of all 189 economies. The report provides
a lot of information and through these information countries can find the opportunity to
compare their economy with other countries economic performances. Businesses’ tax
payment is an important indicator in the report. One of the aims of this study is to
exhibition of Turkey’s status according to Doing Business’s variables with the
comparison between higher ranking countries. Another objective of the study is to
comparing the course of foreign direct investment and rates or number of taxes. The
purpose of doing so is to examine lower total tax rate or tax number countries receive
more direct investment or not. In this study eight years variables are used because
Doing Business ranking being made since 2006.
Field of Research: Economics
JEL Codes: A1, H2
*
Res.Asst. Mete Dibo, Department of Public Finance, Hitit University, Turkey, Email: metedibo@hitit.edu.tr,
metedibo@gmail.com