The Experts below are selected from a list of 146586 Experts worldwide ranked by ideXlab platform
Glenn R Hubbard - One of the best experts on this subject based on the ideXlab platform.
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Tax Policy and business investment
Handbook of Public Economics, 2002Co-Authors: Kevin A Hassett, Glenn R HubbardAbstract:In this survey, we review research on Tax Policy and business investment with four objectives. First, we use a simple prototypical dynamic neoclassical investment model to derive and explain effects of Taxation on business investment in the long run and short run. Second, we describe and evaluate empirical tests of neoclassical channels, and we conclude that recent empirical evidence is consistent with neoclassical intuition. Third, we explore qualifications to basic theoretical models and their empirical tests raised by recent research on irreversibility and capital-market imperfections. Finally, we evaluate arguments for and against using Tax Policy to influence the level or timing of investment.While there is a consensus about the nature and magnitude of Tax Policy on investment demand considerable uncertainty remains regarding the structure of adjustment costs and the short-run dynamic effects of Tax reforms. Consistent with our analysis of equilibrium investment outcomes, ascertaining the effects of Tax Policy on equilibrium investment requires additional research to examine responsiveness of interest rates, output, and the stock market to Tax Policy changes.
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Tax Policy and entrepreneurial entry
The American Economic Review, 2000Co-Authors: William M Gentry, Glenn R HubbardAbstract:Many models of Tax-Policy evaluation abstract from decisions about entrepreneurship, such as entry, saving, and investment. Given recent emphasis on the significance of business ownership in explaining aggregate wealth accumulation and its distribution (see e.g., Gentry and Hubbard, 1999; Vincenzo Quadrini, 1999), such omissions are likely to be significant. In addition, entrepreneurs’ decisions may account for much of the responsiveness of Taxable income to changes in marginal Tax rates. We focus on impacts of Tax rates and, in particular, Tax progressivity on the decision to become an “entrepreneur.” While recent research has examined effects of marginal Tax rates on investment decisions of entrepreneurial households (Robert Carroll et al., 1997), analysis of effects of Taxation on entry is less often pursued. While a proportional Tax with a full loss offset will not affect the entry decision for a risk-neutral individual, a progressive schedule with imperfect loss offsets can discourage entry. We find substantial evidence for this effect on entrepreneurship using variation in Tax schedules faced by households in the Panel Study on Income Dynamics (PSID) over the period from 1979 to 1992. While progressive Taxation could in principle encourage entry via insurance for risk-averse entrepreneurs through the Tax system or through offering greater incentive to avoid Taxes on self-employment income, we find no evidence to support such channels. Our empirical results imply a significant increase in entrepreneurial entry when Tax rates are less progressive; whether such encouragement is efficient (that is, stimulating the most talented entrepreneurs) is a topic for future research. I. Tax Policy and Entrepreneurial Selection
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Tax Policy and investment
National Bureau of Economic Research, 1996Co-Authors: Kevin A Hassett, Glenn R HubbardAbstract:In this paper, we summarize recent advances in the study of effects of Tax Policy on the fixed investment decisions of firms. We attempt to identify consensus where it has been achieved and to highlight important unresolved issues. In addition, we discuss the implications of recent findings for the analysis of Policy options, and discuss arguments for and against long-run Tax Policy that favors business investment spending.
Sebastian Siegloch - One of the best experts on this subject based on the ideXlab platform.
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Tax Policy and Income Inequality in the United States, 1979-2007
Economic Inquiry, 2015Co-Authors: Olivier Bargain, Mathias Dolls, Herwig Immervoll, Dirk Neumann, Andreas Peichl, Nico Pestel, Sebastian SieglochAbstract:This paper assesses the effects of U.S. Tax Policy reforms on inequality over around three decades, from 1979 to 2007. It applies a new method for decomposing changes in government redistribution into (1) a direct Policy effect resulting from Policy changes and (2) the effects of changing market incomes. Over the period as a whole, the Tax Policy changes increased income inequality by pushing up the income share of high-income earners (the top 20%). (JEL H23, H31, H53, P16)
Yoong Lim - One of the best experts on this subject based on the ideXlab platform.
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Tax Policy and Toxic Housing Bubbles in China
The B.E. Journal of Macroeconomics, 2020Co-Authors: Pengfei Jia, Yoong LimAbstract:AbstractThis paper explores the effects of a government Tax Policy in a growth model with economic transition and toxic housing bubbles applied to China. Such a Policy combines Taxing entrepreneurs with a one-time redistribution to workers in the same period. Under the Tax Policy, we find that the welfare improvement for workers is non-monotonic. In particular, there exists an optimal Tax at which social welfare is maximized. Moreover, we consider the welfare effects of setting the Tax at its optimum. We show that the Tax Policy can be welfare-enhancing, comparing to the case without active policies. The optimal Tax may also yield a higher level of welfare than the case even without housing bubbles. In addition, our simple numerical exercise shows that the optimal Tax rate is about 23%;, and social welfare is significantly improved with such a Tax Policy. Finally, we extend the benchmark economy to a multi-period setting and calibrate the model to China. Our results show that a 20%; Tax rate can speed up economic transition and increase output growth. Between 1998 and 2012, aggregate consumption is 4.86%; higher under active Tax policies.
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Tax Policy and Toxic Housing Bubbles in China
2018Co-Authors: Pengfei Jia, Yoong LimAbstract:This paper explores the effects of a government Tax Policy in a growth model with economic transition and toxic housing bubbles applied to China. Such a Policy combines Taxing entrepreneurs with a one-time redistribution to workers in the same period. Under the Tax Policy, we find that the welfare improvement for workers is non-monotonic. In particular, there exists an optimal Tax at which social welfare is maximized. Moreover, we consider the welfare effects of setting the Tax at its optimum. We show that the Tax Policy can be welfare-enhancing, compare to the case without active policies. The optimal Tax may also yield a higher level of welfare than the case even without housing bubbles. Finally, we calibrate the model to China. Our quantitative results show that the optimal Tax rate is about 23 percent, and social welfare is significantly improved with such a Tax Policy.
Olivier Bargain - One of the best experts on this subject based on the ideXlab platform.
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Tax Policy and Income Inequality in the United States, 1979-2007
Economic Inquiry, 2015Co-Authors: Olivier Bargain, Mathias Dolls, Herwig Immervoll, Dirk Neumann, Andreas Peichl, Nico Pestel, Sebastian SieglochAbstract:This paper assesses the effects of U.S. Tax Policy reforms on inequality over around three decades, from 1979 to 2007. It applies a new method for decomposing changes in government redistribution into (1) a direct Policy effect resulting from Policy changes and (2) the effects of changing market incomes. Over the period as a whole, the Tax Policy changes increased income inequality by pushing up the income share of high-income earners (the top 20%). (JEL H23, H31, H53, P16)
Kevin A Hassett - One of the best experts on this subject based on the ideXlab platform.
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Tax Policy and business investment
Handbook of Public Economics, 2002Co-Authors: Kevin A Hassett, Glenn R HubbardAbstract:In this survey, we review research on Tax Policy and business investment with four objectives. First, we use a simple prototypical dynamic neoclassical investment model to derive and explain effects of Taxation on business investment in the long run and short run. Second, we describe and evaluate empirical tests of neoclassical channels, and we conclude that recent empirical evidence is consistent with neoclassical intuition. Third, we explore qualifications to basic theoretical models and their empirical tests raised by recent research on irreversibility and capital-market imperfections. Finally, we evaluate arguments for and against using Tax Policy to influence the level or timing of investment.While there is a consensus about the nature and magnitude of Tax Policy on investment demand considerable uncertainty remains regarding the structure of adjustment costs and the short-run dynamic effects of Tax reforms. Consistent with our analysis of equilibrium investment outcomes, ascertaining the effects of Tax Policy on equilibrium investment requires additional research to examine responsiveness of interest rates, output, and the stock market to Tax Policy changes.
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Tax Policy and investment
National Bureau of Economic Research, 1996Co-Authors: Kevin A Hassett, Glenn R HubbardAbstract:In this paper, we summarize recent advances in the study of effects of Tax Policy on the fixed investment decisions of firms. We attempt to identify consensus where it has been achieved and to highlight important unresolved issues. In addition, we discuss the implications of recent findings for the analysis of Policy options, and discuss arguments for and against long-run Tax Policy that favors business investment spending.
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investment with uncertain Tax Policy does random Tax Policy discourage investment
National Bureau of Economic Research, 1994Co-Authors: Kevin A Hassett, Gilbert E. MetcalfAbstract:In models with irreversible investment, increasing uncertainty about prices has been shown to increase the required rate of return (hurdle rate) and delay investment (e.g., Pindyck, 1988). One serious form of uncertainty faced by firms, a form that Policy makers could conceivably control, is Tax uncertainty. In this paper, we show that it does not follow from past work that Tax Policy uncertainty increases the expected hurdle price ratio and delays investment. This is because Tax uncertainty has an unusual form that distinguishes it from price uncertainty: Tax rates tend to remain constant for many years, and then change in large jumps. When Tax Policy follows a jump process, firms' expectations of the likelihood of the jump occurring have important effects on investment. Indeed, as we show below, while price uncertainty increases the hurdle rate and slows down investment, Tax uncertainty has the opposite effect.
