Economic theory of transfer pricing regulation.

Summary The term "transfer pricing" refers to the price of transactions concluded between subsidiaries of the same multinational enterprise. The thesis deals, from an essentially normative point of view, with the problem of regulating these prices, i.e. determining the optimal way to share the profit of a group between its subsidiaries. The thesis first shows the effect of transfer pricing regulation on firms' production and investment decisions, and then on global welfare. On the basis of the results obtained, the objectives that a benevolent international dictator should assign to this type of regulation are then established. This double work allows us to draw the outline of an optimal regulation project, based on the concept of inter-nation equity, and whose application would lead to assigning to each subsidiary its Shapley value in a previously defined game. The thesis also sheds light on the contemporary debate by proposing a protocol for comparing the arm's length principle with the lump sum allocation method.