Series: IMF Working Papers
Author(s): Geremia Palomba
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 December 2002
Keywords: Firm Investment, Imperfect Capital Markets, Corporate Income Taxation, tax rate, taxation, tax policy, corporate taxation, cost of capital, Taxation and Subsidies: Incidence, Business Taxes and Subsidies including sales and value-added (VAT)
This paper examines the intertemporal effect of corporate income taxation on the investment behavior of a firm that faces imperfect capital markets. It shows that when capital markets are imperfect, the optimizing...