FARM MACHINERY INVESTMENT AND THE TAX REFORM ACT OF 1986

Michael LeBlanc, James Hrubovcak, Ron L. Durst and Roger K. Conway

Journal of Agricultural and Resource Economics, 1992, vol. 17, issue 01, 14

Abstract: The Tax Reform Act of 1986 significantly changed incentives for investing. This analysis specifically examines how changes in marginal tax rates, depreciation schedules, and the investment tax credit altered the cost of capital and net investment in agriculture. A stochastic coefficients econometric methodology is used to estimate an investment function which is then used to simulate the effects of tax reform. Estimates indicated that relative to prior law, the Tax Reform Act will reduce the capital stock of farm machinery and equipment by nearly $4 billion.

Keywords: Agricultural Finance; Farm Management (search for similar items in EconPapers)
Date: 1992
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlaare:30743

DOI: 10.22004/ag.econ.30743

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