Tax Migration as Social Contagion: A Tipping-Point Model with Application to the Scandinavian Wealth Tax Debate

Battle Count: 62

The paper is primarily about tax policy, migration dynamics, and wealth distribution modeling. Limited direct relevance to quantitative trading. Indirect relevance includes: (1) understanding capital flows and tax-driven asset relocation that could affect cross-border fund flows; (2) Pareto tail estimation methods applicable to wealth/asset distributions; (3) Fokker-Planck framework for modeling stochastic wealth evolution; (4) policy risk assessment for Scandinavian/Nordic markets. The tipping-point dynamics could inform regime-change detection in capital flows, but the paper does not address trading strategies, asset pricing, or market microstructure.

The theoretical model involves a scalar nonlinear ODE with exponential multiplier and saddle-node bifurcation analysis (moderate mathematical complexity). The Fokker-Planck framework requires PDE solution and spectral analysis. Empirical implementation involves: (1) web scraping and panel construction from Kapital 400; (2) Hill estimator computation; (3) ligningsformue fingerprint identification; (4) event-study critique requiring understanding of DiD methodology. No ML training or complex computational infrastructure needed. The main complexity lies in the mathematical derivations (bifurcation conditions, drift-shift symmetry proofs) and the careful data construction with manual matching and privacy handling.

The paper provides a replication archive with a Python verification script (data/verify_data.py) performing automated cross-checks against published reference values. Data sources are publicly available (Kapital 400 list from finansavisen.no). However, individual emigrant identities are coded for privacy, and the panel construction involves manual scraping and matching. The theoretical model is fully specified with equations, but formal econometric estimation of contagion parameters is explicitly stated as not credible with available data. Companion papers (Frøseth 2026b,c,d) are referenced for the Fokker-Planck framework.