Download This PaperBusiness Tax Policy Under Default Risk
20 Pages Posted: 25 Jul 2019
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Business Tax Policy Under Default Risk
CESifo Working Paper No. 7664
Number of pages: 20
Posted: 25 Jul 2019
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Business Tax Policy under Default Risk
FEEM Working Paper No. 11.2019
Number of pages: 22
Posted: 10 Jul 2019
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2
Date Written: 2019
Abstract
In this article we use a stochastic model with one representative firm to study business tax policy under default risk. We will show that, for a given tax rate, the government has an incentive to reduce (increase) financial instability and default costs if its objective function is welfare (tax revenue).
Keywords: capital structure, default risk, business taxation and welfare
JEL Classification: H250, G330, G380
Suggested Citation: Suggested Citation
Comincioli, Nicola and Vergalli, Sergio and Panteghini, Paolo M., Business Tax Policy Under Default Risk (2019). CESifo Working Paper No. 7664. Available at SSRN: https://ssrn.com/abstract=3422246
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