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Inversión Privada e Impuestos Corporativos: Evidencia para Chile

Author

Listed:
  • Rodrigo Cerda

    () (Instituto de Economía)

  • Felipe Larraín

    () (Instituto de Economía)

Abstract

Using annual data from Chile since the beginning of the eighties, we show that an increase in the corporate tax reduces firm's investment. However the impact differs across firm size. In small and medium firms, investment as a fraction of the capital stoc

Suggested Citation

  • Rodrigo Cerda & Felipe Larraín, 2005. "Inversión Privada e Impuestos Corporativos: Evidencia para Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 42(126), pages 257-281.
  • Handle: RePEc:ioe:cuadec:v:42:y:2005:i:126:p:257-281
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    References listed on IDEAS

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    1. du Toit, Charlotte & Moolman, Elna, 2004. "A neoclassical investment function of the South African economy," Economic Modelling, Elsevier, vol. 21(4), pages 647-660, July.
    2. Jason G. Cummins & Kevin A. Hassett & R. Glenn Hubbard, 1994. "A Reconsideration of Investment Behavior Using Tax Reforms as Natural Experiments," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, pages 1-74.
    3. Tobin, James, 1969. "A General Equilibrium Approach to Monetary Theory," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 1(1), pages 15-29, February.
    4. R. Vergara, 2010. "Taxation and private investment: evidence for Chile," Applied Economics, Taylor & Francis Journals, vol. 42(6), pages 717-725.
    5. Bustos, Alvaro & Engel, Eduardo M. R. A. & Galetovic, Alexander, 2004. "Could higher taxes increase the long-run demand for capital? Theory and evidence for Chile," Journal of Development Economics, Elsevier, pages 675-697.
    6. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
    7. R. Glenn Hubbard & Anil K. Kashyap & Toni M. Whited, 1993. "Internal Finance and Firm Investment," NBER Working Papers 4392, National Bureau of Economic Research, Inc.
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    Cited by:

    1. repec:chb:bcchec:v:20:y:2017:i:1:p:050-071 is not listed on IDEAS
    2. Christian Glocker & Pascal Towbin, 2012. "Reserve Requirements for Price and Financial Stability: When Are They Effective?," International Journal of Central Banking, International Journal of Central Banking, vol. 8(1), pages 65-114, March.
    3. Cristobal Marshall, 2010. "Is the Tax Credit for SME in Chile an Effective Policy to Boost Investment?," CID Working Papers 46, Center for International Development at Harvard University.
    4. Glocker, Christian & Towbin, Pascal, 2015. "Reserve requirements as a macroprudential instrument – Empirical evidence from Brazil," Journal of Macroeconomics, Elsevier, pages 158-176.
    5. Bernardo Dominichetti H. & María Dolores Roeschmann G., 2006. "Inversión, Flujo de Caja y Colocaciones: Evidencia con Datos Agregados," Notas de Investigación Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, pages 79-83.
    6. Rodrigo Cerda & J. Rodrigo Fuentes & Gonzalo García & José Ignacio Llodrá, 2015. "Understanding Domestic Savings in Chile," IDB Publications (Working Papers) 91437, Inter-American Development Bank.
    7. Christian Glocker & Pascal Towbin, 2012. "The Macroeconomic Effects Of Reserve Requirements," EcoMod2012 3850, EcoMod.
    8. Rodrigo Cerda & J. Rodrigo Fuentes & Gonzalo García & José Ignacio Llodrá, 2015. "Understanding Domestic Savings in Chile," IDB Publications (Working Papers) 7254, Inter-American Development Bank.
    9. Rodrigo Cerda & Felipe Larrain, 2010. "Corporate taxes and the demand for labor and capital in developing countries," Small Business Economics, Springer, pages 187-201.
    10. Bussière, Matthieu & Hoerova, Marie & Klaus, Benjamin, 2015. "Commonality in hedge fund returns: Driving factors and implications," Journal of Banking & Finance, Elsevier, vol. 54(C), pages 266-280.
    11. Rodrigo A. Cerda & Diego Saravia, 2009. "Corporate Tax, Firm Destruction and Capital Stock Accumulation: Evidence From Chilean Plants, 1979-2004," Working Papers Central Bank of Chile 521, Central Bank of Chile.
    12. Peter Huber & Gabriele Tondl, 2012. "Migration and regional convergence in the European Union," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, pages 439-460.

    More about this item

    Keywords

    Investment; small size firms; corporate taxation;

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm

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