Are Tax Effects Important in the Long-Run Fisher Relation?: Evidence from the Municipal Bond Market

William J. Crowder and Mark Wohar ()
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William J. Crowder: University of Texas at Arlington

Finance from EconWPA

Abstract: Recent studies of the Fisher relation have yielded contradictory conclusions on the importance of taxes in determining the long-run response of nominal interest rates to changes in expected inflation. This study uses data on taxable U.S. treasury and tax exempt municipal bond interest rates to shed light on the effects of inflation on nominal interest rates.

Keywords: Fisher Effect; Taxes; Cointegration (search for similar items in EconPapers)
JEL-codes: G (search for similar items in EconPapers)
Date: 1997-02-17, Revised 1997-02-25
Note: Type of Document - PostScript; prepared on IBM PC ; to print on HP Laserjet; pages: 13; figures: included

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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpfi:9702002

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