Suchergebnisse

This paper studies corporate tax competition if it is costly to learn some of the elements that determine the effective tax burden. Search cost may, but need not, eliminate the tax competition pressure. The outcome depends on the boundaries of tax rate and tax base choices. Search cost can explain the empirically observed tax cuts cum base broadening.

"This paper studies corporate tax competition if it is costly to learn some of the
elements that determine the effective tax burden. Search cost may, but need
not, eliminate the tax competition pressure. The outcome depends on the
boundaries of tax rate and tax base choices. Search cost can explain the
empirically observed tax cuts cum base broadening." (author's abstract)

The connections between transport infrastructure and economic development have been extensively analyzed in previous research, but little is known about the cost of infrastructure investments in poor countries. This paper examines drivers of unit costs of construction and maintenance of transport infrastructure in low and middle income countries and documents that: (i) there is a large dispersion in unit costs for comparable road work activities; (ii) after accounting for environmental drivers of costs, residual unit costs are significantly higher in conflict countries; (iii) there is evidence that costs are higher in countries with higher levels of corruption; (iv) these effects are robust to controlling for a country's public investment capacity and business environment. Our findings have implications for governments aiming to increase connectivity in poor countries.

This paper examines the effect of income smoothing on information uncertainty, stock returns, and cost of equity. I show that income smoothing through both total accruals and discretionary accruals tends to reduce firms' information uncertainty, as measured by stock return volatility, analyst earnings forecast dispersion, and analyst earnings forecast error. Further, I provide evidence that stocks of income smoothing firms are priced with a premium. Controlling for earnings shocks and other firm characteristics, income smoothing firms have significantly higher abnormal returns around earnings announcement. In addition, I show that income smoothing reduces firms' implied cost of equity or expected returns. The result is more robust over short horizons up to two years.

THE AUTHORS PRESENT ANALYTIC FORMULAS FOR CALCULATING MARGINAL WELFARE COSTS WHEN TAXES ARE LEVIED AGAINST THE WAGES OF A HETEROGENEOUS POPULATION OF HOUSEHOLDS AND MARGINAL TAX REVENUE FINANCES EITHER THE SUPPLY OF A PUBLIC GOOD OR LUMP-SUM TRANSFERS. THE FORMULAS ARE APPLIED TO EXPLAIN THE WIDE DISCREPANCY BETWEEN ESTIMATES OF MARGINAL WELFARE COSTS FOR REDISTRIBUTION PREVIOUSLY OBTAINED THROUGH COMPUTER SIMULATION PROCEDURES. THE CALCULATIONS REVEAL THAT THESE PROCEDURES INTRODUCED LUMP-SUM TRANSFERS THAT WERE NOT SPECIFIED AS PART OF THE REFORMS TO BE SIMULATED BUT EXPLAIN MOST OF THE DIFFERENCES BETWEEN THEIR ESTIMATES. THE AUTHORS ALSO SHOW THAT WELFARE COST ESTIMATES ARE QUITE SENSITIVE TO THE ELASTICITY OF LABOR SUPPLY WITH RESPECT TO EXHAUSTIVE PUBLIC SPENDING.