Tax Policy and Heterogeneous Investment Behavior

• 成果类型: Article
• 署名作者: Zwick, Eric; Mahon, James
• 署名单位: University of Chicago; National Bureau of Economic Research; Deloitte Touche Tohmatsu Limited
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20140855
• 发表日期: 2017
• 页码: 217-248
• 关键词: Incentives; income; COSTS; cash; firm

摘要

We estimate the effect of temporary tax incentives on equipment investment using shifts in accelerated depreciation. Analyzing data for over 120,000 firms, we present three findings. First, bonus depreciation raised investment in eligible capital relative to ineligible capital by 10.4 percent between 2001 and 2004 and 16.9 percent between 2008 and 2010. Second, small firms respond 95 percent more than big firms. Third, firms respond strongly when the policy generates immediate cash flows, but not when cash flows only come in the future. This heterogeneity materially affects investment-weighted estimates and supports models in which financial frictions or fixed costs amplify investment responses.