European Parliament Library

The Tax Elasticity of Corporate Debt :, A Synthesis of Size and Variations, Ruud A. Mooij

Although the empirical literature has long struggled to identify the impact of taxes on corporate financial structure, a recent boom in studies offers ample support for the debt bias of taxation. Yet, studies differ considerably in effect size and reveal an equally large variety in methodologies and specifications. This paper sheds light on this variation and assesses the systematic impact on the size of the effects. We find that, typically, a one percentage point higher tax rate increases the debt-asset ratio by between 0.17 and 0.28. Responses are increasing over time, which suggests that debt bias distortions have become more important
Table Of Contents
Cover Page; Title Page; Copyright Page; Abstract; Contents; I. Introduction; II. Empirical Studies on Debt Bias; A. Variation in Non-debt Tax Shields; B. Marginal Tax Rates and Incremental Debt; C. Marginal Tax Rates and Debt Levels; 1. Summary of Studies Using Single Country Data; D. Cross-country Studies; 2. Summary of Studies Using Cross-country Variation; III. Constructing a Meta Sample; A. Tax Elasticities of Debt; 3. Summary of Tax Elasticities of Debt in Different Studies; 1. Frequency Distribution of the Tax Elasticity of Debt; B. Variation in Study Characteristics
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (49 p.)
Specific Material Designation
Form Of Item

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