Irreversible investment and endogenous financing: an evaluation of the corporate tax effects

Article Abstract:

The effects of corporate taxes on the investment and financing decisions of a firm were investigated using an econometric model that features an asymmetric tax system. The model assumes that the firm's financing choices are endogenous in nature and that the amount of debt in each firm cannot exceed the value of the firm's capital stock. The impact of imperfect loss carry-overs and different degrees of irreversible investment on incremental investment and entry choices was also analyzed. It was found that the tax distortions on the marginal investment decision are negligible if capital can be financed with debt at the margin. In contrast, the tax distortions on the entry choice are significant.

Public Finance Activities, Econometrics & Model Building, Corporate Tax Rates, Models, Taxation, Corporate taxes, Investments, Econometrics, Finance, Tax rates, Business models

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Investment dynamics with fixed capital adjustment cost and capital market imperfections

Article Abstract:

With reference to United Kingdom, the impact of finance on a firm's investment and capital stocks and in bringing about capital market imperfections is analyzed.

United Kingdom, Analysis, Evaluation, Capital market, Capital markets, Capital stock, Capital stocks

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Financial constraints and entrepreneurial investment

Article Abstract:

The constraints in financing businesses and the distribution of entrepreneurial investment and savings are discussed.

Legal issues & crime, Government regulation (cont), Government regulation, Czech Republic, Goods & services distribution, Legal/Government Regulation, Channels of Distribution, Laws, regulations and rules, Savings, Distribution, Company distribution practices

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