Taxes, capital structure, and bondholder clienteles

Article Abstract:

A competitive financial equilibrium identifies tax clienteles for corporate bonds. State-contingent bonds with higher coupon yields are issued by firms with higher pre-tax cash inflows per dollar of non-debt tax shield when corporate income tax is asymmetric with interest preceding principal. Under this tax regime, the bonds will be purchased by investors in lower tax brackets, and priced at lower marginal tax rates. Investors earn tax-induced surpluses on these bonds. Other bonds have tax rates that are usually equal to the corporate rate and yield no tax-induced surpluses for most investors.

Taxation, Corporate bonds, Bondholders

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Waiting for physicians' services: model and evidence

Article Abstract:

Consumers often incur costs when they must wait beyond scheduled times for services that are distributed by appointment. A model of a physician's office is developed. The model recognizes that office services and accessibility are jointly produced by physicians. The model is used to present estimates of reduced-form waiting time and money-price equations. Results indicate that demand and supply-side factors influence waiting times, and that waiting times diminish physician supply grows.

Models, Queuing theory, Physician services utilization

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Investment returns and yields to holders of insurance

Article Abstract:

The effects of investment returns on insurance policy yields are examined using data for U.S. stock property-liability insurers during 1950-1982. Results indicate that United States stock property-liability policy yields reflect the rates of return in bond markets. Results also indicate that the pre-1987 United States tax code enables insurers to arbitrage between markets for tax-exempt securities and property-liability insurance markets.

Investments, Insurance policies, Arbitrage

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