Decomposing the Welfare Costs of Capital Tax Distortions: The Importance of Risk Assumptions / Bob Hamilton, Jack Mintz, John Whalley.

Format:

Book

Author/Creator:

Hamilton, Bob.

Contributor:

National Bureau of Economic Research.

Mintz, Jack.

Whalley, John.

Series:

Working Paper Series (National Bureau of Economic Research) no. w3628.

NBER working paper series no. w3628

Language:

English

Subjects (All):

Manures.

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Decomposing the Welfare Costs of Capital Tax Distortions

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1991.

Cambridge, Mass. : National Bureau of Economic Research, 1991.

Summary:

This paper analyzes the implications of alterative risk assumptions for estimates of the distorting effects of the corporate tax in Canada. These distortions are decomposed into three broad categories: inter-asset distortions; inter-industry distortions; and inter-temporal distortions. Estimates of marginal effective corporate tax rates are used in a multi-asset general equilibrium model to evaluate the costs of the various distortions, with marginal effective tax rates calculated under alterative risk assumptions. Results indicate that assessments of the relative importance of these distortions are sensitive to alterative risk assumptions used in marginal tax rate calculations. The paper also explores the sensitivity of results to key elasticity parameters in the model.

Notes:

Print version record

February 1991.

Includes bibliographical references.