The recent economic crisis has highlighted the role that financial markets and taxes play in either hampering or promoting the growth of firms and economies. Within financial regulation, the focus has been on reducing excessive risk-taking and targeting market abuse in order to ensure efficiency and transparency. Within tax systems, the focus is increasingly on how business taxation affects productivity and the appeal of specific geographic locations, considering the increasing mobility of companies.
Our Finance & Tax team helps our private and public clients to understand the economics behind public finances and financial market regulation, focusing on policy design and measuring the effects of policy changes.
We analyse how taxation of businesses affects productivity, real wages, and inflows of foreign direct investment. We also look at the costs and benefits of reforms of indirect taxes in terms of reduced compliance costs for businesses and welfare gains for consumers. We also calculate the costs and benefits from policy measures that affect government budgets (revenues or expenditures).
We analyse how regulation impacts the costs of financing investment: What are the gains to society from more risk capital flowing to SMEs? What are the costs and benefits from requiring banks to hold more capital? And what rates of return should you allow for natural monopolies?
