Abstract
This paper uses data from Forbes Magazine’s list of billionaires, supplemented with other publicly available information, to study the migratory behavior of the very rich. Billionaires are more likely to move to countries that share a language and a culture with their country of birth and to countries with larger markets, higher incomes, and lower capital taxes. In total, only 15 % of self-made billionaires—almost all of whom are entrepreneurs—migrated to another country. One explanation for the modest rate of migration may be the country-specificity of entrepreneurs’ human capital. Eight out of ten migrants select a destination country with higher per capita income than that of their birth country, and seven out of ten move to a country with lower capital taxes.
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Notes
Another concern is that we rely on the statutory rather than effective gains tax rates. Measurement error in the explanatory variable of this form may lead to attenuation in the estimated coefficients, making taxes appear less important than they are.
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Acknowledgments
Financial support from the Jan Wallander and Tom Hedelius Research Foundation is gratefully acknowledged. I thank David Cesarini, Kerwin Charles, Robert Lalonde, Raaj Sah and two anonymous referees for useful comments and suggestions.