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The Networked Structure of Tax Havens
- Thomas Sigler and Rory Crofts - 

The motivation to write this paper was twofold. In part, it was personal curiosity. Between the two of us, we have lived in several tax havens, including Bermuda, Luxembourg, and Panama. As one might assume, the day-to-day economic activities of these places differ considerably from those in the rest of world. Their high-rise office towers most often contain banks, but not the sort that one would normally open an account with. In Bermuda, most residents have some tie to the captive insurance industry; Luxembourg’s ‘fiduciaries’ occupy prime real estate near the city center, but are often characterised by vacant offices; Panama is reputed to have more lawyers per capita than New York. As geographers, our intellectual curiosity led us to investigate these places in further depth.

The second reason we wrote this paper was to apply network analysis to understanding the interrelatedness of tax havens. Law firms, banks, and other advanced services providers often pride themselves on offering a broad range of services (e.g. brokerage, domiciling) through a network of local affiliates. Panamanian firms might have affiliates or branch offices in Luxembourg, just as Irish firms may have offices in Jersey or Bermuda. The figure below illustrates this point based on common law firms in the ‘Bermuda Triangle’.

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