Measurement and Tax Depreciation Policy: The Case of Short-Term Assets

36 Pages Posted: 13 Jan 2003

See all articles by David A. Weisbach

David A. Weisbach

University of Chicago - Law School; Center for Robust Decisionmaking on Climate & Energy Policy (RDCEP)

Date Written: January 2003

Abstract

Depreciation is difficult and expensive to measure yet central to measuring capital income. This paper considers whether measurement resources should be allocated to longer-term assets on the theory that depreciation matters more for long-term than for short-term assets. This paper argues that accuracy in depreciation is equally or more important for short-term as for long-term assets. Nevertheless, measurement costs are likely to be higher for short-term assets than for long-term assets, which means we might expect less accuracy, all else equal, for short-term assets.

Suggested Citation

Weisbach, David, Measurement and Tax Depreciation Policy: The Case of Short-Term Assets (January 2003). U Chicago Law & Economics, Olin Working Paper No. 176. Available at SSRN: https://ssrn.com/abstract=368445 or http://dx.doi.org/10.2139/ssrn.368445

David Weisbach (Contact Author)

University of Chicago - Law School ( email )

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Center for Robust Decisionmaking on Climate & Energy Policy (RDCEP) ( email )

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United States

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