Tax Reforms and Investment: A Cross-Country Comparison

Jason Cummins (), Kevin Hassett and Robert Hubbard ()

No 5232, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use firm-level panel data to explore the extent to which fixed investment responds to tax reforms in 14 OECD countries. Previous studies have often found that investment does not respond to changes in the marginal cost of investment. We identify some of the factors responsible for this finding and employ an estimation procedure that sidesteps the most important of them. In so doing, we find evidence of statistically and economically significant investment responses to tax changes in 12 of the 14 countries.

JEL-codes: E2 H3 (search for similar items in EconPapers)
Date: 1995-08
Note: CF PE
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Citations: View citations in EconPapers (78)

Published as Journal of Public Economics, vol. 62, no. 1-2, pp. 237-273, (1996).

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Journal Article: Tax reforms and investment: A cross-country comparison (1996)
Working Paper: tax Reforms and Investment: A Cross-Country Comparison (1995)
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