Skip to main content

Tax Havens and the Commercialization of State Sovereignty

  • Ronen Palan

I seek to explain the causes for the apparent commercialization of state sovereignty, and in particular the reasons for its association with tax havens. I argue that the conditions that gave rise to the commercial use of sovereignty as perfected by tax havens have little to do with surges in taxation and regulation in the postwar era. Instead, these conditions can be traced to jurists' and policymakers' attempts to resolve an inherent contradiction between insulated state law and the rapidly integrating world market.

Hide All
Aliber, Robert Z. 1976. The International Money Game. 2d ed. London: MacMillan.
Auster, Richard D., and Silver, Morris. 1979. The State as a Firm: Economic Forces in Political Development. Boston: Martin Nijhoff.
Banoff, Sheldon I., and Kanter, Burton W.. 1994. States Compete to Save Taxes Owed to Other States. Journal of Taxation 80 (3):382–84.
Barber, Hoyt L. 1993. Tax Havens: How to Bank, Invest, and Do Business—Offshore and Tax Free. New York: McGraw-Hill.
Becker, Helmut, and Wurm, Felix J., eds. 1988. Treaty Shopping: An Emerging Tax Issue and Its Present Status in Various Countries. Dordrecht: Kluwer Law and Taxation.
Bienkowski, Wladyslav. 1981. Theory and Reality: Development of Social Systems. London: Allison and Busby.
Blum, Richard H. 1984. Offshore Haven Banks, Trusts, and Companies: The Business of Crime in the Euromarket. New York: Praeger.
Blum, Richard, and Kaplan, John. 1979. Offshore Banking Issue with Respect to Criminal Use. Paper prepared for the Ford Foundation, November.
Born, Gary B. 1992. A Reappraisal of Extraterritorial Reach of U.S. Law. Law and Policy in International Business 24 (1):1100.
Carlisle, Rodney. 1981. Sovereignty for Sale: The Origins and Evolution of the Panamanian and Liberian Flags of Convenience. Annapolis, Md.: Naval Institute Press.
Cassard, Marcel. 1994. The Role of Offshore Centers in International Financial Intermediation. IMF Working Paper WP/94/107. Washington, D.C.: IMF.
Chandler, Alfred D. 1990. Scale and Scope: The Dynamics of Industrial Capitalism. Cambridge, Mass.: Belknap Press.
Charny, David. 1991. Competition Among Jurisdictions in Formulating Corporate Law Rules: An American Perspective on the “Race to the Bottom” in the European Communities. Harvard International Law Journal 32 (2):423–56.
Chavagneux, Christian, and Palan, Ronen. 1999. Qui a Besoin des Paradis Fiscaux? L'économy Politique 4 (4):1444.
Cole, Kenneth C. 1948. The Theory of the State as a Sovereign Juristic Person. American Political Science Review 42 (1):1631.
Conard, Alfred F. 1973. An Overview of the Laws of Corporations. Michigan Law Review 71 (4):621–90.
Cutler, Claire A. 1997. Artifice, Ideology, and Paradox: The Public/Private Distinction in International Law. Review of International Political Economy 4 (2):261–85.
De Wilde, Jaap. 1991. Saved from Oblivion: Interdependence Theory in the First Half of the 20th Century: A Study of the Causality Between War and Complex Interdependence. Aldershot: Dartmouth.
Devgun, Derek. 1995. International Fiscal Wars for the Twenty-first Century: An Assessment of Tax-Based Trade Retaliation. Law and Policy in International Business 27 (2):353421.
Diamond, Walter H., and Diamond, Dorothy B.. 1998. Tax Havens of the World. New York: Matthew Bender Books.
Doggart, Caroline. 1997. Tax Havens and Their Uses. London: EIU.
Fabri, David, and Baldacchino, Godfrey. 1999. The Malta Financial Services Centre: A Study in MicroState Dependency Management. In Offshore Finance Centers and Tax Havens, edited by Hampton, Mark P. and Abbott, Jason P., 140–65. Basingstoke: MacMillan.
Faith, Nicholas. 1982. Safety in Numbers: the Mysterious World of Swiss Banking. New York: Viking Press.
Fehrenbach, T. R. 1966. The Gnomes of Zurich. London: Leslie Frewin.
Figleton, Paul. 1989. Treasure Islands. Euromoney (May): 1425. Special supplement.
Financial Stability Forum. 2000. Report of the Working Group on Offshore Centers. Available at ⟨⟩. Accessed April 5.
Gilmore, W. C., ed. 1992. International Efforts to Combat Money Laundering. Cambridge: Grotius Publications.
Ginsburg, Anthony Sanfield. 1991. Tax Havens. New York: New York Institute of Finance.
Gordon, Richard A. 1981. Tax Havens and Their Use by United States Taxpayers: An Overview. Report to the Commissioner of Internal Revenue. Washington, D.C.: Books for Business.
Graveson, R. H. 1977. Comparative Conflict of Laws: Selected Essays, Vol. 1. Amsterdam: North-Holland.
Hadari, Yitzhak. 1973. The Structure of the Private Multinational Enterprise. Michigan Law Review 71 (4):729806.
Hampton, Mark. 1996. The Offshore Interface: Tax Havens in the Global Economy. Basingstoke: Macmillan.
Hines, James R. Jr and Rice, Eric M.. 1994. Fiscal Paradise: Foreign Tax Havens and American Business. Quarterly Journal of Economics 109 (1):149–82.
Hudson, Alan C. 1998. Reshaping the Regulatory Landscape: Border Skirmishes Around the Bahamas and Cayman Offshore Financial Centers. Review of International Political Economy 5 (3):534–64.
Hufbauer, Gary Clyde. 1992. U.S. Taxation of International Income: Blueprint for Reform. Washington, D.C.: Institute for International Economics.
Revenue, Inland. 1999. Controlled Foreign Companies (CFCs)—Designer Rate and Similar Regimes. Inland Revenue Press Release 165/99, 6 October.
Jackson, Robert H., and Rosberg, Carl G.. 1986. Sovereignty and Underdevelopment: Juridical Statehood in the African Crisis. Journal of Modern African Studies 24 (1):131.
Jenks, C. Wilfred. 1958. The Common Law of Mankind. London: Stevens and Sons.
Johns, Richard Anthony. 1983. Tax Havens and Offshore Finance: A Study of Transnational Economic Development. New York: St. Martin's Press.
Johns, Richard Anthony, and Le Marchant, C. M.. 1993. Finance Centres: British Isle Offshore Development Since 1979. London: Pinter.
Kish, John. 1973. The Law of International Spaces. Leiden: Sijthoff.
Kochan, Nick. 1991. Cleaning Up by Cleaning Up. Euromoney (April):7377.
Larcom, Russell Carpenter. 1937. The Delaware Corporation. Baltimore, Md.: Johns Hopkins University Press.
Leben, Charles. 1980. Une tentative de perception globale; le recourse a la nationalite des societes. In L'enterprise multinationale: face au droit, edited by Goldman, Berthold and Francescakis, Phocion, 121–53. Paris: Librairies techniques.
Lindholm, Richard W. 1944. The Corporate Franchise as a Basis of Taxation. Austin: University of Texas Press.
Liu, Shih Shun. 1925. Extraterritoriality: Its Rise and Its Decline. New York: Columbia University Press.
Liverani, Mario. 1990. Prestige and Interest: International Relations in the Near East circa 1600–1100 B.C. Padova: Sargon Sri.
Marshall, Don D. 1996. Understanding Late-Twentieth-Century Capitalism: Reassessing the Globalization Theme. Government and Opposition 31 (2): 193215.
Medwig, Michael T. 1992. The New Law Merchant: Legal Rhetoric and Commercial Reality. Law and Policy in International Business 24 (2):589616.
Miller, Gary J. 1981. Cities by Contract: The Politics of Municipal Incorporation. Cambridge, Mass.: MIT Press.
Montebourg, Arnaud. 2000. Rapport D'information Déposé en Application de article 145 Du Réglement Par La Mission D'information Commune Sur Les Obstacles Au Contrôle et À La Répression De La Délinquance Financière et Du Blanchiment Des Capitaux en Europe (1) No. 2311, Assemblée Nationale, Onzième Législature, Enregistré À La Présidence de L'assemblée Nationale le 30 Mars 2000, Tomé 1 and 2.
Murty, T. S. 1978. Frontiers: A Changing Concept. New Delhi: Palit and Palit.
Musalem, Alberto, and Luca, Errico. 1999. Offshore Banking: An Analysis of Micro- and Macro-Prudential Issues. International Monetary Fund Working Paper WP/99/5. Washingon, D.C.: IMF.
Naylor, R. T. 1987. Hot Money and the Politics of Debt. London: Unwin Hyman.
Neale, A. D., and Stephens, M. L.. 1988. International Business and National Jurisdiction. Oxford: Clarendon Press.
Neff, Stephen C. 1990. Friends but No Allies: Economic Liberalism and the Law of Nations. New York: Columbia University Press.
Nussbaum, Arthur. 1962. A Concise History of the Law of Nations. Rev. ed. New York: Macmillan.
OECD. Committee on Fiscal Affairs. 1987. International Tax Avoidance and Evasion: Four Related Studies. Issues in International Taxation No. 1. Paris: OECD.
Palan, Ronen. 1998. Trying to Have Your Cake and Eating It: How and Why the State System Has Created Offshore. International Studies Quarterly 42 (4):625–43.
Palan, Ronen, and Abbott, Jason, with Deans, Phil. 1996. State Strategies in the Global Political Economy. London: Cassel.
Park, Y. S. 1982. The Economics of Offshore Financial Centers. Columbia Journal of World Business 17 (4):3135.
Picciotto, Sol. 1992. International Business Taxation. London: Weidenfeld and Nicolson.
Pollard, Sidney. 1981. Peaceful Conquest: The Industrialization of Europe 1760–1970. Oxford: Oxford University Press.
Poulantzas, Nicos. 1973. Political Power and Social Classes. London: Sheed and Ward.
Prescott, J. R. V. 1975. The Political Geography of the Oceans. New York: John Wiley.
Ranke, Leopold. 1840. The Ecclesiastical and Political History of the Popes of Rome During the Sixteenth and Seventeenth Centuries. 3 vols. London: John Murray.
Robé, Jean-Phillipe. 1997. Multinational Enterprises: The Constitution of a Pluralistic Legal Order. In Global Law Without a State, edited by Teubner, Gunther, 4577. Aldershot: Dartmouth.
Roberts, Susan. 1994. Fictitious Capital, Fictitious Spaces: The Geography of Offshore Financial Flows. In Money Power and Space, edited by Corbridge, Stuart\, Thrift, Nigel, and Martin, Ron, 91115. Oxford: Blackwell.
Robinson, Jeffrey. 1995. The Laundrymen: Inside Money Laundering, the World's Third Largest Business. London: Pocket Books.
Sabine, George H., and Shephard, Walter J.. 1922. Translator's Introduction. In The Modern Idea of the State by Krabbe, Hugo, xi–lxxxi. London: Appleton and Co.
Schmitthoff, Clive M. 1954. The English Conflict of Laws. 3d ed. London: Stevens and Sons.
Schnapper, Dominique. 1998. Community of Citizens: On the Modern Idea of Nationality. New Brunswick, N.J.: Transaction Publishers.
Smith, Adolphe. 1912. Monaco and Monte Carlo. London: Grant Richards.
Starchild, Adam. 1993. Tax Havens for International Business. Basingstoke: Macmillan.
Tiebout, Charles M. 1956. A Pure Theory of Local Expenditures. Journal of Political Economy 64 (5):416–24
Van Asbeck, Frederik Mari. 1976. International Society in Search of a Transnational Legal Order. Leiden: Sijthoff.
Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

International Organization
  • ISSN: 0020-8183
  • EISSN: 1531-5088
  • URL: /core/journals/international-organization
Please enter your name
Please enter a valid email address
Who would you like to send this to? *


Altmetric attention score

Full text views

Total number of HTML views: 0
Total number of PDF views: 509 *
Loading metrics...

Abstract views

Total abstract views: 1884 *
Loading metrics...

* Views captured on Cambridge Core between September 2016 - 25th June 2018. This data will be updated every 24 hours.