The OECD and the International Tax Regime: Persistence Pays Off

The OECD has played a pivotal role in the diffusion of tax practices since its inception: its model tax treaty grew from interwar developments and largely reflects vertical diffusion from US practices and the advice of its experts. The OECD's Harmful Tax Practices project, begun in 1998, ultimately resulted in the Global Forum on Transparency and Exchange of Tax Information in cooperation with the G20. The Forum employs many familiar OECD techniques of horizontal diffusion. All of this is also institutional innovation that can be examined using the theory of rational institutional design. That theory suggests that any free-standing international fiscal organization (IFO) is a non-starter.