Fiscal Policy and Stimuli to R&D Investment with Uncertainty

Chien-Chieh Huang, Wei-Wei Lee and Pai-Ta Shih

Research in World Economy, 2011, vol. 2, issue 2, 55-65

Abstract: Two models are examined in this study, namely, one incorporating exogenous investment and one incorporating endogenous investment and R&D uncertainty. A lump-sum subsidy results in larger net tax revenues than does lowering the profit tax rate in the former model, while this may not be the case in the latter. In the latter model, a proportional investment subsidy generates the highest net tax revenues with low market volatility and always results in larger net tax revenues than does lowering the profit tax rate.

Keywords: Real option; R&D; Irreversibility; Fiscal policies (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciedu.ca/journal/index.php/rwe/article/view/494/249 (application/pdf)
http://www.sciedu.ca/journal/index.php/rwe/article/view/494 (text/html)

Related works:
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:jfr:rwe111:v:2:y:2011:i:2:p:55-65

Access Statistics for this article

Research in World Economy is currently edited by Gina Perry

More articles in Research in World Economy from Research in World Economy, Sciedu Press
Bibliographic data for series maintained by Gina Perry ().