| Abstract |
The Austrian approach analysing the impact of government interference on the structure of production is focused mostly on money and credit with little exploration of the effect of fiscal policy. This paper considers general tax cuts on capital income and their effects on the structure of production in a world of heterogenous capital goods. In particular, it focuses on the expected duration of a fiscal policy change through a rational expectations lens and resulting economy-wide capital investment decisions. It finds that tax policy deferentially affects heterogenous capital characterized by different economic payback periods. This finding has implications for realized capital investment and economic growth due to tax cuts targeting capital income and resulting support for tax cuts. |
| Authors |
Alexander Specht  
|
| Journal Info |
RELX Group (Netherlands) | SSRN
|
| Publication Date |
11/27/2023 |
| ISSN |
1556-5068 |
Type |
article |
| Open Access |
closed
|
| DOI |
https://doi.org/10.2139/ssrn.4615161 |
| Keywords |
Corporate Tax (Score: 0.526569) , Taxation (Score: 0.506767)
|
