Heterogeneous Tax Sensitivity of Firm-level Investments

Peter Egger, Katharina Erhardt () and Christian Keuschnigg

No 306, Economics Series from Institute for Advanced Studies

Abstract: Firms are heterogeneous in size, productivity, ownership concentration, governance, financial structure and other dimensions. This paper introduces a stylized theoretical framework to account for such differences and to explain the heterogeneous tax sensitivity of firm-level investments across firm types. We econometrically test the theoretical predictions, taking account of selection of firms into different regimes. We find important differences in the tax sensitivity of investment of small entrepreneurial and larger managerial firms in different financial regimes that are largely in line with theoretical results.

Keywords: Corporate tax; personal taxes; firm heterogeneity; access to capital; manager-shareholder conflicts (search for similar items in EconPapers)
JEL-codes: D22 G32 H25 L21 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2014-09
New Economics Papers: this item is included in nep-acc, nep-bec, nep-cfn and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://irihs.ihs.ac.at/id/eprint/2908 First version, 2014 (application/pdf)

Related works:
Journal Article: Heterogeneous tax sensitivity of firm-level investments (2020)
Working Paper: Heterogeneous Tax Sensitivity of Firm-level Investments (2018)
Working Paper: Heterogeneous Tax Sensitivity of Firm-level Investments (2014)
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