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The Effects of Taxation on the Selling of Corporate Stock and the Realization of Capital Gains

17 Pages Posted: 15 Feb 2001 Last revised: 9 Sep 2010

Martin S. Feldstein

National Bureau of Economic Research (NBER); Harvard University

Joel B. Slemrod

University of Michigan, Stephen M. Ross School of Business; National Bureau of Economic Research (NBER)

Shlomo Yitzhaki

Hebrew University of Jerusalem - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: March 1981

Abstract

This study provides the first econometric analysis of the effect of taxation on the realization of capital gains. The analysis thus extends and complements the earlier study by Feldstein and Yitzhaki [1978] of the effect of taxation on the selling of corporate stock. The present analysis, using a large, new body of data obtained from individual tax returns, supports the earlier finding that corporate stock sales are quite sensitive to tax rates and then shows that the effect on the realization of capital gains is even stronger.

Suggested Citation

Feldstein, Martin S. and Slemrod, Joel B. and Yitzhaki, Shlomo, The Effects of Taxation on the Selling of Corporate Stock and the Realization of Capital Gains (March 1981). NBER Working Paper No. w0250. Available at SSRN: https://ssrn.com/abstract=260440

Martin Feldstein (Contact Author)

Harvard University ( email )

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National Bureau of Economic Research (NBER) ( email )

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Joel Slemrod

University of Michigan, Stephen M. Ross School of Business ( email )

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National Bureau of Economic Research (NBER)

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Shlomo Yitzhaki

Hebrew University of Jerusalem - Department of Economics ( email )

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Israel
+972 2 659 2201 (Phone)
+972 2 652 2319 (Fax)

National Bureau of Economic Research (NBER) ( email )

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