Production efficiency and the design of temporary investment incentives

• 成果类型: Article
• 署名作者: Jack, W; Viard, AD
• 署名单位: University System of Ohio; Ohio State University
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/0047-2727(95)01523-X
• 发表日期: 1996
• 页码: 87-106
• 关键词: investment incentives; neutrality; temporary policies

摘要

The attainment of production efficiency requires that tax incentives equalize pretax rates of return on different assets at each point in time. To achieve this objective, the conventional theory of investment tax credits (ITCs) prescribes significantly lower credit rates on shorter-lived assets. However, this result is valid only for permanent ITCs. We show that the credit rates for temporary ITCs should be much closer to uniform than the conventional theory prescribes. This result is robust to the presence and specification of adjustment costs.