Adherence to the OECD Model Tax Convention: A Textual Analysis of Member and Non-Member Countries’ Double Taxation Agreements

Markus Diller; Daniel Ehm; Patrick Katzlmayr; Johannes Lorenz

doi:10.1515/ael-2023-0126

Article

Adherence to the OECD Model Tax Convention: A Textual Analysis of Member and Non-Member Countries’ Double Taxation Agreements

Markus Diller , Daniel Ehm , Patrick Katzlmayr and Johannes Lorenz

Published/Copyright: December 4, 2024

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From the journal Accounting, Economics, and Law: A Convivium

Abstract

This paper examines the textual design of Double Taxation Agreements (DTAs). Using Natural Language Processing (NLP) techniques we analyze the heterogeneity of a country’s set of DTAs and the drivers that lead to (non-)adherence to the OECD Model Convention. We observe that wealthier countries hold a more diverse DTA set compared to poorer countries and more frequently diverge from the OECD Model Convention. Furthermore, we show that negotiation results are less likely to follow the OECD Model Convention when treaty partners are closely related in terms of trade volume or share a colonial history. Institutional factors, such as OECD or EU membership, can counteract this effect and thus lead to a stronger adherence to the OECD Model Convention. As such, our study highlights how socio-economic, institutional, and geopolitical factors influence (non-)adherence to the OECD Model Convention and how this depends on the article under consideration.

Keywords: double taxation agreement; international tax policy; OECD

JEL Classification: K33; K34; F55

Corresponding author: Markus Diller, 26580 University of Passau , Passau, Germany, E-mail: markus.diller@uni-passau.de

We would like to thank Yuri Biondi (editor) and three anonymous reviewers, as well as the participants of the 2023 European Accounting Association annual conference in Helsinki, and the 2022 arqus (Working Group Quantitative Tax Research) meeting in Magdeburg, Germany, for helpful comments.

Table 6:

Construction of article vectors.

Word	Dividends	Paid	Company	…	Reit	Mining	Mutual
DTA	Dividends	Paid	Company	…	Reit	Mining	Mutual
v ⃗ GER,Div,LIE	0.271606	0.108679	0.177145	…	0.077798	0.000000	0.000000
v ⃗ OECD ( 2017 ) ,Div	0.333375	0.177860	0.267608	…	0.000000	0.039920	0.049925
v ⃗ GER,Div,EST	0.421863	0.155476	0.222789	…	0.000000	0.039881	0.000000

Note: The table shows the TF-IDF scores following formula (1) for six words in the respective articles. The value 0 indicates that a word is not prevalent in the article. To illustrate, the word “company” is assigned a value of 0.27 in the article text on “Dividends” in the 2017 OECD Model Convention and a value of 0.22 in the DTA between Germany and Estonia. The lower TF-IDF score indicates that the word “company” is less specific in the DTA between Germany and Estonia than in the 2017 Model Convention. Table 8 holds the article texts for the displayed country pairs.

Table 7:

Full overall ranking – country variation.

	Rank	Div.	Associated E.	Permanent E.	Int.	Business P.	Roy.	%-OECD
United States	80.0	0.015	0.028	0.015	0.013	0.014	0.017	41.5
New Zealand	79.0	0.013	0.022	0.014	0.012	0.014	0.015	60.5
United Kingdom	78.0	0.014	0.018	0.013	0.013	0.015	0.014	22.5
Netherlands	77.0	0.013	0.022	0.013	0.012	0.012	0.013	31.2
France	76.0	0.014	0.017	0.012	0.013	0.011	0.014	20.0
Norway	75.0	0.013	0.018	0.013	0.012	0.012	0.014	27.8
Canada	74.0	0.012	0.023	0.012	0.012	0.011	0.013	30.7
Denmark	73.0	0.012	0.018	0.013	0.011	0.011	0.013	30.8
Egypt	72.0	0.013	0.025	0.012	0.011	0.014	0.012	41.9
Malaysia	71.0	0.013	0.018	0.011	0.013	0.009	0.013	27.5
Japan	70.0	0.011	0.018	0.014	0.011	0.014	0.012	42.1
Australia	69.0	0.014	0.017	0.013	0.010	0.014	0.012	52.5
Belgium	68.0	0.012	0.017	0.012	0.011	0.012	0.012	26.2
Luxembourg	67.0	0.012	0.017	0.012	0.011	0.012	0.013	30.7
Finland	66.0	0.012	0.017	0.010	0.012	0.012	0.013	27.9
Indonesia	65.0	0.011	0.018	0.011	0.011	0.013	0.013	34.3
Thailand	63.5	0.012	0.018	0.011	0.012	0.008	0.012	36.7
Kazakhstan	63.5	0.011	0.016	0.012	0.012	0.015	0.011	47.6
Philippines	62.0	0.011	0.018	0.012	0.011	0.008	0.013	51.2
UAE	61.0	0.011	0.016	0.013	0.011	0.010	0.013	28.1
Sri Lanka	60.0	0.011	0.017	0.012	0.012	0.008	0.013	34.8
Mexico	59.0	0.010	0.018	0.012	0.012	0.007	0.014	48.3
Russia	58.0	0.011	0.023	0.013	0.010	0.011	0.012	36.9
Sweden	57.0	0.013	0.017	0.011	0.012	0.009	0.013	25.0
Ireland	56.0	0.012	0.016	0.011	0.011	0.013	0.013	32.4
Pakistan	54.5	0.011	0.014	0.012	0.011	0.009	0.015	31.1
Germany	54.5	0.013	0.014	0.010	0.013	0.009	0.013	29.1
Malta	53.0	0.012	0.016	0.011	0.011	0.010	0.012	34.2
Venezuela	52.0	0.010	0.018	0.011	0.011	0.007	0.014	56.2
Israel	51.0	0.012	0.017	0.012	0.011	0.010	0.011	37.5
India	49.0	0.008	0.015	0.012	0.011	0.013	0.014	34.1
Bahrain	49.0	0.010	0.016	0.012	0.012	0.008	0.013	37.8
Morocco	49.0	0.010	0.019	0.011	0.010	0.008	0.014	37.7
Tunisia	47.0	0.012	0.018	0.013	0.010	0.009	0.012	35.4
Cyprus	46.0	0.011	0.017	0.011	0.010	0.010	0.012	40.0
Singapore	45.0	0.013	0.016	0.010	0.012	0.010	0.010	25.0
Austria	44.0	0.011	0.014	0.010	0.011	0.011	0.012	30.5
Slovak Republic	43.0	0.010	0.017	0.010	0.010	0.011	0.012	39.1
Vietnam	42.0	0.010	0.018	0.010	0.011	0.007	0.013	37.1
Korea (Rep.)	41.0	0.009	0.016	0.010	0.012	0.009	0.011	29.5
Switzerland	40.0	0.010	0.019	0.010	0.011	0.007	0.012	31.9
Romania	39.0	0.010	0.015	0.012	0.011	0.007	0.012	27.9
Spain	38.0	0.011	0.015	0.011	0.010	0.006	0.013	26.4
Qatar	37.0	0.011	0.016	0.011	0.011	0.007	0.011	28.1
Chile	36.0	0.009	0.016	0.013	0.009	0.007	0.010	59.4
Mauritius	35.0	0.011	0.016	0.011	0.010	0.010	0.010	18.6
Hungary	34.0	0.009	0.015	0.011	0.011	0.009	0.011	27.6
Bangladesh	33.0	0.009	0.014	0.011	0.011	0.007	0.011	48.5
Estonia	32.0	0.010	0.015	0.009	0.011	0.007	0.012	42.4
Iceland	31.0	0.010	0.014	0.010	0.011	0.008	0.012	56.4
Poland	30.0	0.008	0.014	0.011	0.010	0.011	0.011	36.8
South Africa	29.0	0.009	0.014	0.011	0.010	0.007	0.011	34.2
Italy	27.5	0.010	0.016	0.010	0.009	0.006	0.012	26.3
Czech Republic	27.5	0.009	0.016	0.010	0.011	0.006	0.012	31.1
Portugal	26.0	0.010	0.015	0.010	0.010	0.008	0.010	28.9
Turkey	25.0	0.010	0.011	0.010	0.012	0.007	0.009	28.2
Ukraine	23.5	0.008	0.014	0.010	0.010	0.010	0.011	37.1
Kuwait	23.5	0.010	0.014	0.011	0.010	0.007	0.010	33.9
Uzbekistan	22.0	0.009	0.015	0.011	0.010	0.008	0.009	48.9
Bulgaria	21.0	0.009	0.014	0.011	0.009	0.006	0.012	24.6
Slovenia	20.0	0.008	0.012	0.009	0.010	0.013	0.009	48.2
Serbia	19.0	0.008	0.012	0.011	0.007	0.014	0.008	39.0
Brazil	18.0	0.011	0.003	0.011	0.009	0.005	0.012	51.4
Albania	17.0	0.009	0.010	0.011	0.009	0.011	0.010	45.2
Bosnia-Herze.	16.0	0.010	0.012	0.009	0.009	0.010	0.010	45.7
Greece	15.0	0.007	0.014	0.012	0.008	0.007	0.010	29.2
Belarus	14.0	0.008	0.014	0.010	0.010	0.006	0.010	27.3
Lithuania	13.0	0.008	0.010	0.009	0.009	0.012	0.010	45.3
Armenia	12.0	0.009	0.011	0.009	0.009	0.008	0.009	50.0
Georgia	11.0	0.009	0.010	0.010	0.009	0.006	0.010	52.0
Macedonia (FYR)	10.0	0.009	0.013	0.010	0.009	0.006	0.010	42.6
Saudi Arabia	9.0	0.008	0.009	0.010	0.008	0.010	0.005	39.1
Latvia	8.0	0.008	0.013	0.009	0.010	0.006	0.011	39.3
Azerbaijan	7.0	0.008	0.012	0.009	0.010	0.006	0.008	47.6
Montenegro	6.0	0.009	0.012	0.009	0.007	0.006	0.009	44.2
Croatia	5.0	0.008	0.011	0.009	0.008	0.007	0.009	35.9
China	4.0	0.008	0.010	0.009	0.010	0.006	0.009	28.4
Moldova	3.0	0.007	0.012	0.009	0.008	0.006	0.008	32.6
Iran	2.0	0.008	0.010	0.009	0.008	0.006	0.007	24.0
Hong Kong	1.0	0.006	0.007	0.006	0.009	0.006	0.005	50.0

Note: The table shows the full country ranking, as well as the article-level heterogeneity and the OECD share of each country’s DTA set. A higher rank implies greater heterogeneity.

Figure 5:

Robustness – absolute differences. The figure shows the results for the fifteen top- and bottom-ranked countries using absolute differences instead of squared differences as a robustness test. Dark blue indicates a high ranking (= high heterogeneity), while light blue indicates a low ranking (= low heterogeneity).

Figure 6:

Robustness – median value country vectors. The figure shows the results for the fifteen top- and bottom-ranked countries using median values for the construction of country vectors instead of average values as a robustness test. Dark blue indicates a high ranking (= high heterogeneity), while light blue indicates a low ranking (= low heterogeneity).

Table 8:

Comparison of article texts.

Germany – Liechtenstein (2020) Similarity score: 0.42	Model Convention (2017)	Germany – Estonia (2020) Similarity score: 0.95
1. Dividends paid by a company which is a resident of a contracting state to a resident of the other contracting state may be taxed in that other state.	1. Dividends paid by a company which is a resident of a contracting state to a resident of the other contracting state may be taxed in that other state.	1. Dividends paid by a company which is a resident of a contracting state to a resident of the other contracting state may be taxed in that other state.
2. However, such dividends may also be taxed in the contracting state of which the company paying the dividends is a resident and according to the laws of that state, but if the beneficial owner of the dividends is a resident of the other contracting state, the tax so charged shall not exceed: a) 0 per cent of the gross amount of the dividends if the beneficial owner is a company (other than a partnership) which at the time of the payment of dividends has held for an uninterrupted period of twelve months directly at least 10 per cent of the voting shares of the company paying the dividends; b) 5 per cent of the gross amount of the dividends not falling under subparagraph (a) if the beneficial owner is a company (other than a partnership) which holds directly at least 10 per cent of the voting shares of the company paying the dividends; c) 15 per cent of the gross amount of the dividends in all other cases. The provisions of subparagraph (c) shall apply instead of the provisions of subparagraphs (a) and (b) to dividends paid by a German real estate investment trust company with shares quoted on a stock exchange (Immobilien-Aktiengesellschaft mit börsennotierten Anteilen, REIT AG), a German investment fund (Investmentfonds), a German investment company (Investmentaktiengesellschaft), a Liechtenstein undertaking for collective investment in transferable securities (Organismus für gemeinsame Anlagen in Wertpapieren, OGAW) and a Liechtenstein investment undertaking (Investmentunternehmen). This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.	2. However, dividends paid by a company which is a resident of a contracting state may also be taxed in that state according to the laws of that state, but if the beneficial owner of the dividends is a resident of the other contracting state, the tax so charged shall not exceed: a) 5 per cent of the gross amount of the dividends if the beneficial owner is a company which holds directly at least 25 per cent of the capital of the company paying the dividends throughout a 365 day period that includes the day of the payment of the dividend (for the purpose of computing that period, no account shall be taken of changes of ownership that would directly result from a corporate reorganisation, such as a merger or divisive reorganisation, of the company that holds the shares or that pays the dividend); b) 15 per cent of the gross amount of the dividends in all other cases. The competent authorities of the contracting states shall by mutual agreement settle the mode of application of these limitations. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.	2. However, such dividends may also be taxed in the contracting state of which the company paying the dividends is a resident and according to the laws of that state, but if the recipient is the beneficial owner of the dividends the tax so charged shall not exceed: a) 5 per cent of the gross amount of the dividends if the beneficial owner is a company (other than a partnership) which holds directly at least 25 per cent of the capital of the company paying the dividends throughout a 365 day period that includes the day of the payment of the dividends (for the purpose of computing that period, no account shall be taken of changes of ownership that would directly result from a corporate reorganisation, such as a merger or divisive reorganisation, of the company that holds the shares or that pays the dividends); b) 15 per cent of the gross amount of the dividends in all other cases. *The competent authorities of the contracting states shall by mutual agreement settle the mode of application of these* . This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.
3. The term ”dividends” as used in this article means income from shares, ”jouissance” shares or ”jouissance” rights, *mining shares,* founders’ shares, or other rights, not being debt-claims, participating in profits, as well as other income which is subjected to the same taxation treatment as income from shares by the laws of the state of which the company making the distribution is a resident, and in the Federal Republic of Germany income from distributions on certificates of an investment fund and in the principality of Liechtenstein income from distributions on certificates of an OGAW or of an investment undertaking.	3. The term “dividends” as used in this article means income from shares, “jouissance” shares or “jouissance” rights, mining shares, founders’ shares or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights which is subjected to the same taxation treatment as income from shares by the laws of the state of which the company making the distribution is a resident.	3. The term “dividends” as used in this article means dividends on shares including income from shares, ”jouissance” shares or ”jouissance” rights, mining shares, founders’ shares or other rights, not being debt-claims, participating in profits, *as well as income from other corporate rights* and other income which is subjected to the same taxation treatment as income from shares by the laws of the state of which the company making the distribution is a resident.
4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a contracting state, carries on business in the other contracting state of which the company paying the dividends is a resident through a permanent establishment situated therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. In such case the provisions of article 7 shall apply.	4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a contracting state, carries on business in the other contracting state of which the company paying the dividends is a resident through a permanent establishment situated therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. In such case the provisions of article 7 shall apply.	4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a contracting state, carries on business in the other contracting state of which the company paying the dividends is a resident, through a permanent establishment situated therein, or performs in that other state independent personal services from a fixed base situated therein, and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment or fixed base. In such case the provisions of article 7 or article 14, as the case may be, shall apply.
5. Where a company which is a resident of a contracting state derives profits or income from the other contracting state, that other state may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other state or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment situated in that other state, nor subject the company’s undistributed profits to a tax on the company’s undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other state.	5. Where a company which is a resident of a contracting state derives profits or income from the other contracting state, that other state may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other state or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment situated in that other state, nor subject the company’s undistributed profits to a tax on the company’s undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other state.	5. Where a company which is a resident of a contracting state derives profits or income from the other contracting state, that other state may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other state or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other state, nor subject the company’s undistributed profits to a tax on the company’s undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other state.

Note: The table shows the “Dividends” article for the DTAs between Germany – Estonia and Germany – Liechtenstein, as well as the “Dividends” article of the 2017 Model Convention. Differences from the Model Convention are indicated in bold-print text. Passages in bold and italics have been added by the authors to indicate sections of the Model Convention that were not included by the negotiating parties. The DTA between Germany and Estonia exhibits a greater degree of similarity to the 2017 OECD Model Convention. This is also evident from the TF-IDF scores presented in Table 6, which indicate that the values for the DTA between Germany and Estonia are more closely aligned with those of the 2017 Model Convention than those of the DTA between Germany and Liechtenstein.

Table 9:

Similarity scores – ranking of the most divergent DTAs.

Partner 1	Partner 2	Div	Int	Roy	PE	BP	AE	Sum ranks
Kazakhstan	Russia	26.0	11.0	7.0	1.0	84.0	12.0	1.0
TT	United States	10.0	5.0	52.0	24.0	133.0	8.0	2.0
Korea (Dem. Rep.)	Korea (Rep.)	38.0	13.0	29.0	4.0	275.0	29.0	3.5
Guernsey	Qatar	21.0	77.0	33.0	3.0	224.0	30.0	3.5
Israel	United States	25.0	127.0	23.0	22.0	206.0	6.0	5.0
Egypt	United States	19.0	146.0	26.0	14.0	205.0	7.0	6.0
Isle of Man	Qatar	62.0	97.0	47.0	157.0	1.0	55.0	7.0
Korea (Rep.)	United States	14.0	186.0	32.0	89.0	102.0	1.0	8.0
New Zealand	Taiwan	11.0	7.0	6.0	193.0	214.0	10.0	9.0
Hong Kong	Pakistan	44.0	32.0	43.0	2.0	270.0	59.0	10.0
Morocco	United States	65.0	234.0	13.0	30.0	109.0	3.0	11.0
Guernsey	Isle of Man	16.0	51.5	132.0	9.0	220.0	37.5	12.0
Jamaica	United Kingdom	18.0	12.0	25.0	49.0	215.0	167.0	13.0
Germany	Macedonia (FYR)	12.0	6.0	5.0	141.0	246.0	88.0	14.0
Jersey	UAE	63.0	49.0	48.0	78.0	217.0	50.0	15.0
Cyprus	United States	35.0	196.0	27.0	166.0	90.0	9.0	16.0
Belarus	Hong Kong	4.0	22.0	162.0	11.0	261.0	71.0	17.0
Norway	United States	172.0	242.0	22.0	64.0	101.0	2.0	18.0
Jersey	Mauritius	41.0	87.0	171.0	7.0	247.5	68.0	19.0
Taiwan	Thailand	20.0	10.0	9.0	253.0	314.0	31.0	20.0
Hong Kong	Switzerland	66.0	24.0	14.0	268.0	229.0	56.0	21.0
Hong Kong	Netherlands	72.0	132.0	129.0	27.0	263.0	57.0	22.0
Isle of Man	Malta	91.0	72.0	220.5	256.0	6.0	50.0	23.0
Malaysia	New Zealand	43.0	60.0	86.0	170.0	264.0	85.0	24.0
Hong Kong	South Africa	141.0	47.0	110.0	55.0	247.5	108.0	25.0
Denmark	Taiwan	31.0	16.0	19.0	330.0	297.0	26.0	26.0
Hong Kong	Russia	51.0	73.0	49.0	199.0	240.0	108.0	27.0
Hong Kong	Malaysia	114.0	27.0	45.0	205.0	268.0	64.5	28.0
Hong Kong	UAE	104.0	19.0	83.0	198.0	228.0	92.0	29.0
Hong Kong	Portugal	133.0	36.0	44.0	210.0	232.5	72.0	30.0
Guernsey	Singapore	82.0	37.0	46.0	258.0	227.0	81.0	31.0
Canada	Hong Kong	32.0	15.0	34.0	372.0	238.0	45.0	32.0
Hong Kong	United Kingdom	98.0	23.0	62.0	234.0	232.5	92.0	33.0
Hong Kong	Indonesia	92.0	33.0	91.0	159.0	267.0	108.0	34.0
Bermuda	Qatar	54.0	94.0	55.0	213.0	253.0	89.0	35.0
Hong Kong	Kuwait	79.0	20.0	70.0	214.0	273.0	108.0	36.0
Hong Kong	Mexico	87.0	44.0	42.0	212.0	276.0	108.0	37.0
Hong Kong	Latvia	33.0	39.0	100.0	263.0	244.5	108.0	38.0
Belgium	Taiwan	17.0	9.0	8.0	446.0	287.0	25.0	39.0
Hong Kong	Romania	48.0	25.0	146.0	222.0	244.5	108.0	40.0
Greenland	Norway	28.0	61.0	21.0	430.0	249.5	14.5	41.0
France	Hong Kong	100.0	34.0	134.0	201.0	271.0	64.5	42.0
Estonia	Jersey	30.0	54.0	124.5	308.5	241.0	50.0	43.5
Czech Republic	Hong Kong	116.0	83.0	87.0	202.0	225.0	95.0	43.5
Hong Kong	Qatar	60.0	93.0	92.0	209.0	251.0	108.0	45.0
Hong Kong	Ireland	94.0	45.0	58.0	313.0	218.5	108.0	46.0
Philippines	United States	73.0	184.0	206.0	33.0	348.0	4.0	47.0
Hong Kong	Hungary	149.0	28.0	59.5	313.0	232.5	73.0	48.0
Egypt	India	3.0	69.0	210.0	419.0	130.0	36.0	49.0
Guernsey	Malta	61.0	59.0	73.0	387.0	243.0	50.0	50.0
Guernsey	Hong Kong	75.0	79.0	77.5	313.0	237.0	92.0	51.0
Hong Kong	Italy	110.0	53.0	69.0	300.0	280.0	62.0	52.0
Isle of Man	Jersey	46.5	55.5	132.0	383.5	221.5	50.0	53.5
Guernsey	Jersey	46.5	55.5	132.0	383.5	221.5	50.0	53.5
Jersey	Rwanda	117.0	63.0	106.0	190.0	307.0	108.0	55.0
Brunei	Hong Kong	122.0	48.0	148.0	196.0	257.0	122.0	56.0
Bahrain	Bermuda	102.0	21.0	263.0	189.0	255.5	66.0	57.0
Fiji	New Zealand	40.0	126.0	239.0	97.0	332.0	67.0	58.0
Hong Kong	Malta	99.0	113.5	54.0	313.0	218.5	108.0	59.0
Austria	Hong Kong	123.0	84.0	59.5	313.0	226.0	108.0	60.0
Jersey	Seychelles	90.0	74.0	189.0	240.0	262.0	76.0	61.0
Guernsey	Seychelles	111.0	112.0	56.0	316.0	278.0	75.0	62.0
Greenland	Iceland	84.0	65.0	10.0	528.0	249.5	14.5	63.0
Hong Kong	Vietnam	77.0	29.0	37.0	167.0	553.0	92.0	64.0
Hong Kong	Jersey	88.0	113.5	77.5	317.0	252.0	108.0	65.0
Isle of Man	Seychelles	67.0	80.0	68.0	402.0	277.0	80.0	66.0
Hong Kong	Liechtenstein	97.0	133.0	90.0	278.0	283.0	108.0	67.0
Hong Kong	Spain	148.0	40.0	82.0	400.0	232.5	92.0	68.0
Falkland Islands	United Kingdom	27.0	30.0	144.0	516.0	260.0	18.0	69.0
Indonesia	United States	167.0	177.0	109.0	185.0	340.0	23.0	70.0
Romania	United States	249.0	422.0	51.0	74.0	210.0	5.0	71.0
Hong Kong	Korea (Rep.)	152.0	46.0	89.0	397.0	223.0	108.0	72.0
Jersey	Liechtenstein	37.0	99.0	267.5	10.0	562.0	63.0	73.0
Jersey	Malta	85.0	70.0	220.5	381.0	239.0	50.0	74.0
Hong Kong	Japan	153.0	26.0	115.0	415.0	258.0	82.0	75.0
Guernsey	Mauritius	83.0	150.0	252.0	265.0	254.0	108.0	76.0
Bahrain	Isle of Man	81.0	35.0	276.0	377.0	255.5	108.0	77.0
Hong Kong	Thailand	106.0	43.0	159.0	155.0	560.0	123.0	78.0
Estonia	Isle of Man	36.0	58.0	124.5	308.5	574.0	50.0	79.0
Taiwan	Vietnam	103.0	68.0	40.0	204.0	639.0	108.0	80.0
Guernsey	Monaco	68.0	51.5	127.0	386.0	536.0	50.0	81.0
France	St. Martin	109.0	71.0	165.0	514.0	242.0	127.0	82.0
Australia	New Zealand	448.0	162.0	305.0	187.0	24.0	179.0	83.0
Hong Kong	Luxembourg	151.0	147.0	88.0	303.0	523.0	108.0	84.0
Belgium	Hong Kong	139.0	62.0	50.0	56.0	943.0	96.0	85.0
France	Quebec	121.0	17.0	38.0	426.0	608.0	137.0	86.0
Gambia	United Kingdom	24.0	8.0	17.0	208.0	1,096.0	79.0	87.0
Isle of Man	Luxembourg	126.0	88.0	191.0	357.0	589.5	108.0	88.0
Finland	Malaysia	204.0	172.0	213.0	629.0	38.0	219.0	89.0
Australia	Netherlands	282.0	514.0	247.0	238.0	66.0	139.0	90.0
Cyprus	Jersey	105.0	78.0	182.0	328.0	715.0	108.0	91.0
Guernsey	Liechtenstein	80.0	116.0	267.5	410.5	564.0	86.0	92.0
France	St. Pierre and Miq.	55.0	41.5	136.0	968.0	298.5	34.0	93.0
Australia	Malaysia	296.0	288.0	204.0	272.0	338.0	143.0	94.0
Jersey	Luxembourg	126.0	131.0	273.0	327.0	600.0	121.0	95.0
Austria	Faroe Islands	207.0	801.0	11.0	32.0	213.0	318.0	96.0
Cyprus	Guernsey	115.0	119.0	267.5	410.5	583.0	108.0	97.0
Australia	Indonesia	253.0	698.0	250.0	251.0	17.0	138.0	98.0
Guernsey	Luxembourg	126.0	130.0	267.5	392.0	589.5	108.0	99.0
Australia	India	394.0	701.0	112.0	262.0	16.0	161.0	100.0
Australia	United States	124.0	341.0	215.0	106.0	718.0	149.0	101.0
Australia	Canada	143.0	821.0	217.0	310.0	9.0	155.0	102.0
Belgium	Luxembourg	42.0	339.0	107.0	35.0	630.0	533.0	103.0
Australia	Japan	263.0	564.0	353.0	344.0	43.0	159.0	104.0
France	Sri Lanka	13.0	14.0	24.0	409.0	645.0	635.5	105.0
Australia	Norway	274.0	650.0	286.0	318.0	33.0	188.0	106.0
Canada	New Zealand	191.0	110.0	429.0	294.0	269.0	458.0	107.0
France	New Caledonia	45.0	41.5	64.0	1,230.0	298.5	78.0	108.0
Australia	Ireland	101.0	937.0	285.0	252.0	61.0	135.0	109.0
Malaysia	PNG	177.0	151.0	440.0	545.0	337.0	141.0	110.0
Australia	Finland	300.0	714.0	272.0	299.0	27.0	182.0	111.0
Canada	United States	200.0	407.0	450.0	211.0	545.0	11.0	112.0
Australia	United Kingdom	226.0	609.0	362.0	440.0	41.0	173.0	113.0
Australia	Belgium	238.0	951.0	301.0	279.0	22.0	150.0	114.0
Belgium	Ireland	446.0	111.0	496.0	434.0	19.0	449.0	115.0
Cameroon	UAE	150.0	178.0	1,000.0	61.0	349.0	239.0	116.0
Estonia	Guernsey	34.0	18.0	12.0	1,338.0	539.0	37.5	117.0
Austria	Luxembourg	142.0	217.0	260.0	283.0	160.0	936.5	118.0
Australia	Denmark	228.0	1,102.0	310.0	239.0	69.0	160.0	119.0
Australia	PNG	71.0	796.0	245.0	245.0	591.0	169.0	120.0
Russia	United States	359.0	462.0	638.0	366.0	284.0	24.0	121.0
Australia	France	533.0	764.0	331.0	369.0	23.0	131.0	122.0
Gibraltar	United Kingdom	7.5	4.0	1.0	1,933.0	293.5	20.5	123.0
Jersey	United Kingdom	7.5	2.0	3.0	1,942.0	293.5	20.5	125.0
Isle of Man	United Kingdom	7.5	2.0	3.0	1,942.0	293.5	20.5	125.0
Guernsey	United Kingdom	7.5	2.0	3.0	1,942.0	293.5	20.5	125.0
Slovak Republic	Sri Lanka	1.5	105.5	35.5	295.5	1,589.5	295.5	127.5
Czech Republic	Sri Lanka	1.5	105.5	35.5	295.5	1,589.5	295.5	127.5
Australia	Germany	420.0	916.0	282.0	194.0	281.0	241.0	129.0
Oman	Sri Lanka	638.0	696.0	164.0	23.0	522.0	334.0	130.0
Australia	Slovak Republic	463.0	1,094.0	209.0	433.0	25.0	175.0	131.0
France	India	239.0	168.0	147.0	823.0	21.0	1,087.0	132.0
Barbados	Canada	227.0	337.0	308.0	657.0	499.0	471.0	133.0
Brunei	Cambodia	679.0	347.0	566.0	50.0	495.0	364.0	134.0
Nigeria	Singapore	251.0	577.0	826.0	45.0	425.0	420.0	135.0
Kazakhstan	United States	364.0	703.0	790.0	336.0	334.0	120.0	136.0
Canada	PNG	86.0	633.0	387.0	277.0	1,108.0	181.0	137.0
Australia	Philippines	215.0	656.0	261.0	270.0	1,147.0	154.0	138.0
Indonesia	Netherlands	520.0	392.0	223.0	297.0	18.0	1,265.0	139.0
Belgium	Malaysia	96.0	66.0	424.0	602.0	1,183.0	377.0	140.0
Australia	Switzerland	447.0	570.0	322.0	500.0	626.0	285.0	141.0
Finland	United Kingdom	571.0	354.0	242.0	876.0	129.0	588.0	142.0
Morocco	Zambia	757.0	1,033.0	143.0	62.0	424.0	348.0	143.0
India	Netherlands	502.0	82.0	16.0	780.0	4.0	1,384.5	144.0
Australia	Spain	383.0	551.0	255.0	304.0	1,131.0	147.0	145.0
Australia	Thailand	197.0	861.0	172.0	228.0	1,160.0	158.0	146.0
Bangladesh	United States	225.0	209.0	227.0	1,041.0	767.0	312.0	147.0
Australia	Sweden	367.0	622.0	259.0	242.0	1,150.0	151.0	148.0
Malaysia	Thailand	203.0	188.0	185.0	473.0	1,252.0	546.0	149.0
Canada	Netherlands	244.0	96.0	551.0	1,717.0	93.0	162.0	150.0
Australia	Kiribati	371.0	781.0	258.0	231.0	1,092.0	157.0	151.0
Australia	South Africa	426.0	693.0	271.0	288.0	1,091.0	152.0	152.0
Indonesia	Singapore	566.0	85.0	1,423.0	17.0	496.0	354.0	153.0
Canada	Indonesia	1,546.0	138.0	380.0	527.0	125.0	261.5	154.0
Italy	Switzerland	374.0	785.0	382.0	39.0	671.0	742.0	155.0
Australia	Fiji	306.0	913.0	264.0	250.0	1,120.0	145.0	156.0
Australia	Israel	252.0	249.0	314.0	1,611.0	402.0	177.0	157.0
New Zealand	United States	154.0	125.0	586.0	770.0	1,113.0	280.0	158.0
Australia	Sri Lanka	363.0	894.0	274.0	236.0	1,111.0	165.5	159.0
Norway	TT	76.0	121.0	249.0	352.0	484.0	1,765.0	160.0
Bahrain	Pakistan	790.0	64.0	184.0	112.0	290.0	1,660.0	161.0
Costa Rica	UAE	385.0	962.0	561.0	570.0	367.0	258.0	162.0
Australia	Italy	475.0	760.0	303.0	255.0	1,185.0	130.0	163.0
Ecuador	Russia	859.0	727.0	581.0	337.0	365.0	266.0	164.0
Belarus	Kyrgyzstan	435.0	644.0	370.0	67.0	216.0	1,413.0	165.0
Austria	Netherlands	1,094.0	388.0	287.0	808.0	112.0	494.5	166.0
Australia	Malta	315.0	963.0	277.0	271.0	1,227.0	133.0	167.0
Ukraine	United States	210.0	685.0	1,366.0	449.0	356.0	170.0	168.0
New Zealand	Sweden	542.0	1,926.0	409.0	219.0	113.0	41.0	169.0
Australia	Mexico	477.0	653.0	278.0	554.0	1,099.0	194.0	170.0
New Zealand	Thailand	654.0	723.0	187.0	394.0	1,190.0	136.0	171.0
Denmark	Malaysia	138.0	872.0	476.0	353.0	1,179.0	267.5	172.0
China	Malaysia	393.0	31.0	508.0	1,494.0	368.0	536.0	173.0
Australia	Czech Republic	376.0	921.0	240.0	532.0	1,116.0	153.0	174.0
Sri Lanka	United States	216.0	833.0	457.0	364.0	1,152.0	328.0	175.0
Australia	Romania	372.0	935.0	236.0	510.0	1,125.0	176.0	176.0
Mexico	United States	190.0	190.0	609.0	834.0	1,271.0	279.0	177.0
Indonesia	Poland	786.0	858.0	571.0	609.0	86.0	477.0	178.0
Mauritius	United Kingdom	380.0	1,248.0	952.0	70.0	12.0	742.0	179.0
Ireland	United Kingdom	137.0	344.0	605.0	1,148.0	87.0	1,087.0	180.0
Indonesia	Mexico	582.0	699.0	364.0	831.0	391.0	551.0	181.0
Fiji	PNG	1,274.0	156.0	279.0	287.0	1,126.0	309.0	182.0
Korea (Rep.)	Vietnam	848.0	223.0	208.0	160.0	361.0	1,633.0	183.0
Jamaica	United States	411.0	1,037.0	793.0	93.0	1,087.0	16.5	184.0
Serbia	Singapore	120.0	104.0	705.0	82.0	812.0	1,633.0	185.0
Egypt	United Kingdom	95.0	1,001.0	407.0	809.0	64.0	1,087.0	186.0
PNG	Singapore	329.0	1,211.0	406.0	249.0	1,074.0	195.0	187.0
Australia	Turkey	824.0	1,381.0	304.0	481.0	329.0	146.0	188.0
Argentina	Germany	694.0	330.0	381.0	280.0	734.0	1,087.0	189.0
India	Portugal	500.0	2,136.0	20.0	18.0	36.0	816.0	190.0
Canada	United Kingdom	276.0	414.0	600.0	1,719.0	236.0	283.0	191.0
Georgia	Saudi Arabia	262.0	263.0	1,248.0	102.0	374.0	1,284.0	192.0
Indonesia	United Kingdom	135.0	273.0	1,509.0	814.0	121.0	690.0	193.0
Australia	Poland	659.0	874.0	270.0	474.0	1,104.0	165.5	194.0
Ivory Coast	Norway	987.0	1,459.0	436.0	200.0	266.0	222.0	195.0
Argentina	Norway	651.0	363.0	391.0	647.0	1,233.0	300.0	196.0
Australia	Vietnam	407.0	952.0	284.0	670.0	1,122.0	172.0	197.0
Argentina	Australia	536.0	1,103.0	67.0	690.0	1,101.0	124.0	198.0
Malaysia	Philippines	266.0	465.0	224.0	478.0	1,102.0	1,087.0	199.0
Oman	Slovak Republic	537.0	1,106.0	1,066.0	85.0	504.0	341.0	200.0
Argentina	Sweden	504.0	154.0	318.0	760.0	1,307.0	598.0	201.0
India	Switzerland	1,170.0	144.0	57.0	395.0	619.0	1,267.0	202.5
France	Philippines	440.0	573.0	596.0	592.0	364.0	1,087.0	202.5
Australia	Korea (Rep.)	424.0	1,075.0	386.0	414.0	1,325.0	42.0	204.0
Malaysia	Malta	264.0	179.0	413.0	547.0	1,582.0	690.0	205.0
Kazakhstan	Singapore	182.0	185.0	860.0	1,537.0	39.0	873.0	206.0
Netherlands	United States	113.0	102.0	228.0	1,927.0	1,133.0	174.0	207.0
Armenia	Turkmenistan	1,110.0	571.0	332.0	87.0	166.0	1,434.0	208.0
New Zealand	PNG	1,833.0	300.0	403.0	526.0	323.0	327.0	209.0
India	Indonesia	1,776.0	630.0	79.0	845.0	20.0	376.0	210.0
Thailand	United States	318.0	635.0	588.0	489.0	1,121.0	582.0	211.0
Chile	Czech Republic	1,149.0	153.0	732.0	633.0	301.0	783.0	212.0
France	Malaysia	39.0	907.0	538.0	463.0	1,569.0	267.5	213.0
Bahrain	Thailand	779.0	95.0	2,018.0	16.0	526.0	361.0	214.0
Belgium	Denmark	585.0	335.0	918.0	585.0	1,172.0	223.0	215.0
Malta	Netherlands	233.0	75.0	451.0	741.0	1,881.0	440.0	216.0
Argentina	Finland	455.0	376.0	298.0	1,058.0	1,251.0	395.0	217.0
Canada	Mexico	801.0	710.0	340.0	542.0	1,191.0	251.0	218.0
Argentina	Mexico	1,451.0	283.0	330.0	928.0	399.0	466.0	219.0
India	Sweden	1,108.0	212.0	98.0	1,177.0	1,077.0	200.0	220.0
Canada	Kazakhstan	860.0	580.0	1,822.0	456.0	15.0	144.0	221.0
Australia	Hungary	911.0	1,078.0	297.0	339.0	1,178.0	126.0	222.0
Japan	New Zealand	769.0	122.0	639.0	257.0	5.0	2,164.0	223.0
Botswana	Czech Republic	1,005.0	1,423.0	200.0	127.0	415.5	787.0	224.0
Canada	India	2,335.0	1,019.0	18.0	338.0	74.0	184.5	225.0
Germany	Tunisia	855.0	124.0	660.0	136.0	513.0	1,693.0	226.0
United States	Venezuela	386.0	1,021.0	422.0	765.0	1,103.0	294.0	227.5
Bahrain	Brunei	910.0	936.0	456.0	717.0	525.0	447.0	227.5
Cambodia	Thailand	710.0	488.0	1,309.0	60.0	594.0	855.0	229.0
Netherlands	Suriname	202.0	1,040.0	630.0	79.0	1,788.0	293.0	230.0
Singapore	Tunisia	256.0	791.0	1,733.0	104.0	565.5	608.0	231.0
South Africa	United States	254.0	305.0	388.0	1,121.0	629.0	1,366.0	232.0
Canada	Spain	295.0	378.0	663.0	1,773.0	681.0	281.0	233.0
Jamaica	Sweden	604.0	902.0	1,813.0	220.0	344.0	191.0	234.0
Malaysia	Poland	160.0	1,291.0	534.0	451.0	1,171.0	487.0	235.0
Belgium	Germany	243.0	296.0	192.0	946.0	1,340.0	1,087.0	236.0
Singapore	South Africa	445.0	198.0	1,304.0	632.0	675.0	862.0	237.0
Chile	Japan	1,328.0	194.0	1,026.0	90.0	1,093.0	406.0	238.0
Belgium	Pakistan	325.0	803.0	813.0	553.0	1,397.0	249.0	239.0
Bolivia	France	201.0	256.0	458.0	558.0	2,157.0	516.0	240.0
Netherlands	Serbia	820.0	1,121.0	725.0	918.0	88.0	494.5	241.0
France	Indonesia	596.0	585.0	1,375.0	391.0	141.0	1,087.0	242.0
Philippines	Romania	856.0	818.0	526.0	408.0	1,318.0	260.0	243.0
Canada	South Africa	807.0	338.0	882.0	838.0	1,289.0	40.0	244.0
Austria	United States	294.0	220.0	851.0	1,925.0	680.0	227.0	245.0
Austria	India	890.0	1,389.0	145.0	72.0	313.0	1,395.0	246.0
Ireland	Switzerland	997.0	1,095.0	989.0	36.0	520.0	570.0	247.0
Malaysia	Pakistan	187.0	506.0	296.0	385.0	1,755.0	1,087.0	248.0
Malta	Poland	319.0	1,948.0	961.0	91.0	35.0	886.0	249.0
Germany	Mexico	1,073.0	515.0	865.0	117.0	812.0	870.0	250.0

Note: The table presents a ranking of the 250 DTAs exhibiting the lowest similarity to the respective OECD Model Convention. The columns Div (“Dividends”), Int (“Interest”), Roy (“Royalties”), PE (“Permanent Establishment”), BP (“Business Profits”), and AE (“Associated Enterprises”) represent the rank per article. For 2,922 DTAs in our dataset, the DTA with the lowest similarity score is ranked 1, and the DTA with the highest similarity score is ranked 2,922. The “Sum Ranks” column shows the overall rank based on the individual article ranks; the rank 1 indicates the lowest similarity across all articles and vice versa. The abbreviation “PNG” stands for Papua New Guinea and “TT” for Trinidad and Tobago.

Table 10:

Empirical specification.

Variable	Definition	Source
OECD(1)	Indicator variable = 1 if the country pair contains one OECD member state.	OECD
OECD(2)	Indicator variable = 1 if the country pair contains two OECD member states.	OECD
EU(1)	Indicator variable = 1 if the country pair contains one EU member state.	European Union
EU(2)	Indicator variable = 1 if the country pair contains two EU member states.	European Union
TaxHaven(1)	Indicator variable = 1 if the country pair contains one tax haven.	OECD progress report
Colony	Indicator variable = 1 if the country pair has a colonial past.	Mayer and Zignago 2011
Continent	Indicator variable = 1 if the country pair is located on the same continent.	Mayer and Zignago 2011
lndistance	Log absolute difference in kilometers between two treaty partners’ capitals.	Mayer and Zignago
lnGDPcapitadiff	Log absolute difference in GDP per capita between treaty partners.	World Bank
lnGDPcapitasum	Log sum of GDP per capita of treaty partners.	World Bank
lntradevolume	Log sum of bilateral trade of treaty partners.	World Bank
lnpopdiff	Log of absolute difference in population between treaty partners.	World Bank
lnGDPdiff	Log absolute difference in GDP between treaty partners.	World Bank
English	Indicator variable = 1 if DTA is available officially in the English language.	Mayer and Zignago 2011

Note: The table shows the definitions and the sources of the covariates used in the regression analysis.

Table 11:

Robustness II. – including English dummy and one year lag.

	Dividends		Interest		Royalties		Business Profits		Associated E.		Permanent E.
	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err
OECD(1)(t–1)	0.049	0.009^***	0.003	0.011	−0.003	0.012	0.003	0.008	−0.008	0.012	0.023	0.009^***
OECD(2)(t–1)	0.051	0.018^***	0.018	0.019	0.008	0.019	0.014	0.015	−0.020	0.018	0.041	0.014^***
EU(1)(t–1)	0.020	0.009^**	0.041	0.010^***	0.024	0.009^***	0.008	0.008	0.081	0.010^***	0.034	0.007^***
EU(2)(t–1)	0.022	0.018	0.063	0.015^***	0.033	0.015^**	0.014	0.019	0.123	0.017^***	0.058	0.016^***
TaxHaven(1)	−0.064	0.028^**	−0.030	0.029	0.034	0.023	0.018	0.035	0.042	0.042	0.027	0.021
Colony	−0.080	0.019^***	−0.045	0.019^**	−0.020	0.017	−0.050	0.022^**	−0.001	0.022	−0.024	0.016
Continent	0.003	0.008	−0.024	0.007^***	−0.001	0.009	0.005	0.006	0.020	0.010^**	0.002	0.007
lndistance	−0.027	0.006^***	−0.046	0.005^***	−0.021	0.006^***	−0.008	0.004^*	−0.017	0.007^**	−0.020	0.006^***
lnGDPcapitadiff(t–1)	0.021	0.004^***	0.009	0.004^**	−0.003	0.004	0.014	0.003^***	0.012	0.003^***	0.001	0.002
lnGDPcapitasum(t–1)	−0.074	0.008^***	−0.032	0.008^***	−0.003	0.007	−0.033	0.007^***	−0.049	0.007^***	−0.010	0.006
lntradevolume(t–1)	−0.012	0.002^***	−0.014	0.002^***	−0.010	0.003^***	−0.008	0.002^***	−0.015	0.003^***	−0.010	0.001^***
lnpopdiff(t–1)	0.010	0.002^***	−0.001	0.002	−0.013	0.003^***	−0.002	0.002	0.008	0.003^***	−0.000	0.002
lnGDPdiff(t–1)	−0.006	0.003^**	−0.004	0.002^*	0.010	0.003^***	0.010	0.003^***	0.002	0.003	0.013	0.002^***
English	−0.070	0.008^***	0.004	0.006	−0.066	0.008^***	−0.061	0.008^***	−0.037	0.008^***	−0.032	0.006^***
Year fixed effects	Yes		Yes		Yes		Yes		Yes		Yes
Observations	2,113		2,113		2,113		2,113		2,113		2,113
Adj. R2	0.318		0.183		0.184		0.285		0.205		0.349

Dependent variable: sim v ⃗ c , a , p , v ⃗ OECD, a . Standard errors are clustered at the time level. ***, ** and * indicate significance at the 1, 5 and 10 % confidence level.

Table 12:

Robustness III. – including English dummy and three year lag.

	Dividends		Interest		Royalties		Business Profits		Associated E.		Permanent E.
	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err
OECD(1)(t–3)	0.053	0.010^***	−0.004	0.013	−0.003	0.013	−0.001	0.008	−0.007	0.013	0.025	0.009^***
OECD(2)(t–3)	0.052	0.019^***	0.014	0.022	0.012	0.019	0.009	0.016	−0.023	0.020	0.041	0.014^***
EU(1)(t–3)	0.015	0.010	0.042	0.011^***	0.024	0.009^**	0.011	0.008	0.075	0.011^***	0.032	0.007^***
EU(2)(t–3)	0.020	0.018	0.066	0.017^***	0.036	0.016^**	0.027	0.020	0.122	0.019^***	0.059	0.017^***
TaxHaven(1)	−0.069	0.026^***	−0.043	0.034	0.032	0.026	0.003	0.033	0.014	0.041	0.023	0.022
Colony	−0.063	0.017^***	−0.035	0.017^**	−0.014	0.017	−0.047	0.023^**	0.006	0.021	−0.013	0.015
Continent	0.001	0.008	−0.026	0.008^***	0.004	0.009	0.008	0.006	0.013	0.010	0.001	0.008
lndistance	−0.028	0.006^***	−0.047	0.006^***	−0.017	0.006^***	−0.005	0.005	−0.020	0.008^***	−0.019	0.007^***
lnGDPcapitadiff(t–3)	0.020	0.005^***	0.008	0.005^*	−0.005	0.004	0.012	0.003^***	0.009	0.004^**	−0.001	0.003
lnGDPcapitasum(t–3)	−0.070	0.008^***	−0.026	0.009^***	−0.002	0.007	−0.031	0.007^***	−0.044	0.007^***	−0.008	0.007
lntradevolume(t–3)	−0.014	0.002^***	−0.015	0.003^***	−0.011	0.003^***	−0.009	0.002^***	−0.016	0.003^***	−0.010	0.001^***
lnpopdiff(t–3)	0.012	0.003^***	0.000	0.002	−0.014	0.003^***	−0.003	0.003	0.009	0.002^***	0.000	0.002
lnGDPdiff(t–3)	−0.006	0.003^*	−0.004	0.003	0.011	0.003^***	0.011	0.003^***	0.002	0.003	0.012	0.002^***
English	−0.071	0.009^***	0.001	0.007	−0.067	0.009^***	−0.063	0.008^***	−0.034	0.008^***	−0.035	0.006^***
Year fixed effects	Yes		Yes		Yes		Yes		Yes		Yes
Observations	1,981		1,981		1,981		1,981		1,981		1,981
Adj. R2	0.317		0.184		0.182		0.298		0.201		0.353

Dependent variable: sim v ⃗ c , a , p , v ⃗ OECD, a . Standard errors are clustered at the time level. ***, ** and * indicate significance at the 1, 5 and 10 % confidence level.

Table 13:

Robustness IV. – dependent variable: logarithmized OECD similarity.

	Dividends		Interest		Royalties		Business Profits		Associated E.		Permanent E.
	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err	Est.	Std err
OECD(1)	0.081	0.015^***	0.011	0.018	0.004	0.020	−0.001	0.013	−0.001	0.018	0.033	0.012^***
OECD(2)	0.091	0.033^***	0.061	0.035^*	0.034	0.033	0.002	0.023	0.001	0.033	0.055	0.019^***
EU(1)	0.025	0.017	0.053	0.017^***	0.036	0.017^**	0.013	0.013	0.130	0.021^***	0.042	0.009^***
EU(2)	0.021	0.030	0.080	0.025^***	0.037	0.025	0.009	0.030	0.179	0.025^***	0.076	0.019^***
TaxHaven(1)	−0.107	0.048^**	−0.037	0.049	0.021	0.043	−0.010	0.041	0.015	0.074	0.024	0.030
Colony	−0.162	0.040^***	−0.082	0.036^**	−0.058	0.032^*	−0.098	0.034^***	−0.019	0.036	−0.048	0.026^*
Continent	−0.002	0.014	−0.042	0.011^***	−0.008	0.015	0.004	0.009	0.029	0.017^*	−0.003	0.009
lndistance	−0.057	0.011^***	−0.070	0.009^***	−0.048	0.010^***	−0.023	0.007^***	−0.032	0.012^***	−0.031	0.008^***
lnGDPcapitadiff	0.034	0.006^***	0.015	0.006^***	−0.006	0.007	0.017	0.005^***	0.015	0.006^**	−0.001	0.003
lnGDPcapitasum	−0.119	0.013^***	−0.056	0.014^***	−0.012	0.013	−0.046	0.009^***	−0.081	0.013^***	−0.013	0.008^*
lntradevolume	−0.020	0.004^***	−0.023	0.004^***	−0.016	0.005^***	−0.010	0.003^***	−0.023	0.004^***	−0.013	0.002^***
lnpopdiff	0.012	0.004^***	−0.001	0.004	−0.027	0.006^***	−0.009	0.004^**	0.008	0.004^**	−0.002	0.003
lnGDPdiff	−0.008	0.006	0.001	0.004	0.018	0.005^***	0.015	0.003^***	0.003	0.005	0.017	0.004^***
Year fixed effects	Yes		Yes		Yes		Yes		Yes		Yes
Observations	2,211		2,211		2,211		2,211		2,211		2,211
Adj. R2	0.273		0.167		0.130		0.186		0.169		0.376

Dependent variable: ln sim v ⃗ c , a , p , v ⃗ OECD, a . Standard errors are clustered at the time level. ***, ** and * indicate significance at the 1, 5 and 10 % confidence level.

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Received: 2023-11-13

Accepted: 2024-09-02

Published Online: 2024-12-04

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https://doi.org/10.1515/ael-2023-0126

Keywords for this article

double taxation agreement; international tax policy; OECD