Wait-and-See: Investment Options under Policy Uncertainty

Nancy L. Stokey

No 19630, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper develops a model of investment decisions in which uncertainty about a one-time change in tax policy induces the firm to temporarily stop investing--to adopt a wait-and-see policy. After the uncertainty is resolved, the firm exploits the tabled projects, generating a temporary investment boom.

JEL-codes: D92 E22 E32 H32 (search for similar items in EconPapers)
Date: 2013-11
New Economics Papers: this item is included in nep-mac and nep-ppm
Note: EFG
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Citations: View citations in EconPapers (4)

Published as Review of Economic Dynamics Available online 9 June 2015 In Press, Corrected Proof — Note to users Cover image Wait-and-see: Investment options under policy uncertainty Nancy L. Stokey1,

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