Review of Economic Studies Vol. 53 No. 2 1986
The Dynamic Effects of Tax Law Asymmetries
Abstract
Under the laws of most countries, a distinction is made between gains and losses by businesses. Losses that must be “carried forward” are subjept to two penalties: a loss of interest, and expiration. Previous examinations have focused on the higher expected tax payments such a tax system without “full loss offset” imposes on risky projects. This paper presents a dynamic analysis of the impact of taxation on investment when gains and losses are treated asymmetrically. The results demonstrate how firm characteristics and the timing of taxes can influence behaviour.
- DOI
- 10.2307/2297647
- Volume
- 53
- Issue
- 2
- Pages
- 205
- Sources
- bibtex:phds-export.bib openalex crossref