Distributing Patronage Income Under Differing Tax Rates and Member Risk Preferences

Levi Russell and Brian Briggeman

Journal of Cooperatives, 2014, vol. 29, 24

Abstract: This paper examines the effects of income tax rates and member risk preferences on the distribution of patronage income in a local agricultural cooperative. The paper uses a modified mean-variance model to provide some discussion points on how to consider the interaction of tax and member risk preferences on maximizing member benefits. Our results suggest that qualified earnings distributions should be relatively low under current tax policy conditions, and consideration should be given to using non-qualified distributions. Also, optimal patronage income distributions are more affected by significant changes in member risk preferences than significant changes in taxes.

Keywords: Demand and Price Analysis; Public Economics (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlcoop:244024

DOI: 10.22004/ag.econ.244024

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