The Implications of Risk and Irreversibility for the Measurement of Marginal Effective Tax Rates on Capital

Kenneth McKenzie

Canadian Journal of Economics, 1994, vol. 27, issue 3, 604-19

Abstract: The implications of risk and irreversibility for the measurement of marginal effective tax rates on capital are examined. It is shown that, when capital is irreversible, the marginal effective tax rate is an increasing function of systematic and unsystematic capital and income risk. The tax system may, thus, distort investments in risky capital to a much greater extent than is implied by previous research that ignored irreversibilities. Marginal effective tax rate calculations based upon the Canadian corporate tax system are provided.

Date: 1994
References: Add references at CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
http://links.jstor.org/sici?sici=0008-4085%2819940 ... IORAI%3E2.0.CO%3B2-K (text/html)
only available to JSTOR subscribers

Related works:
Working Paper: The Implications of Risk and Irreversibility for the Measurement of Marginal Effective Tax Rates of Capital (1992)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cje:issued:v:27:y:1994:i:3:p:604-19

Ordering information: This journal article can be ordered from
https://www.economic ... ionen/membership.php

Access Statistics for this article

Canadian Journal of Economics is currently edited by Zhiqi Chen

More articles in Canadian Journal of Economics from Canadian Economics Association Canadian Economics Association Prof. Werrner Antweiler, Treasurer UBC Sauder School of Business 2053 Main Mall Vancouver, BC, V6T 1Z2. Contact information at EDIRC.
Bibliographic data for series maintained by Prof. Werner Antweiler ().