Corporate taxes, growth and welfare in a Schumpeterian economy

• 成果类型: Article
• 署名作者: Peretto, Pietro F.
• 署名单位: Duke University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2006.11.005
• 发表日期: 2007
• 页码: 353-382
• 关键词: endogenous growth; market structure; Dividends; corporate taxation

摘要

I take a new look at the long-run implications of taxation through the lens of modem Schumpeterian growth theory. I focus on the latest vintage of models that sterilize the scale effect through a process of product proliferation that fragments the aggregate market into submarkets whose size does not increase with the size of the workforce. I show that the following interventions raise welfare: (a) granting full expensibility of R&D to incorporated firms; (b) eliminating the corporate income tax and/or the capital gains tax; (c) reducing taxes on labor and/or consumption. What makes these results remarkable is that in all three cases the endogenous increase in the tax on dividends necessary to balance the budget has a positive effect on growth. A general implication of my analysis is that corporate taxation plays a special role in Schumpeterian economies and provides novel insights on how to design welfare-enhancing tax reforms. (c) 2007 Elsevier Inc. All rights reserved.