The Johansson-Samuelson Theorem in General Equilibrium: A Rebuttal

28 Pages Posted: 14 Jul 2008

See all articles by Francesco Menoncin

Francesco Menoncin

University of Brescia - Department of Economics

Paolo M. Panteghini

Department of Economics and Management; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Date Written: July 2008

Abstract

The well-known Johansson-Samuelson Theorem proves that, in partial equilibrium, comprehensive income taxation with a uniform tax rate is neutral in terms of investment decisions, if fiscal depreciation allowances coincide with economic depreciation. In this article we show that this result does not hold in general equilibrium, unless fairly restrictive conditions are met.

Keywords: general equilibrium, investment neutrality, uniform taxation

JEL Classification: H25, H32

Suggested Citation

Menoncin, Francesco and Panteghini, Paolo M., The Johansson-Samuelson Theorem in General Equilibrium: A Rebuttal (July 2008). CESifo Working Paper Series No. 2352, Available at SSRN: https://ssrn.com/abstract=1159704

Francesco Menoncin

University of Brescia - Department of Economics ( email )

Via San Faustino 74B
Brescia, 25122
Italy
0039-0302988806 (Phone)
0039-0302988837 (Fax)

HOME PAGE: http://www.eco.unibs.it/~menoncin/

Paolo M. Panteghini (Contact Author)

Department of Economics and Management ( email )

Contrada Santa Chiara 50
BRESCIA, BS 25122
Italy

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.cesifo.de

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