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O výpočte fiškálneho dopadu investičnej podpory
[On calculus of fiscal impact of investment incentives]

Author

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  • Peter Bolcha

Abstract

The paper focuses on selective investment incentives. The main aim is to discuss question how to quantify net fiscal impact properly. As shown, the problem is not trivial - the proper quantification presupposes using of several parameters, accounting of costs in the economic sense of this word (i.e. also opportunity costs) and using concept of present value. Including these aspects in the calculation would correct some extremely optimistic scenarios (of studies concerning Czech economy), which claim, that fiscal incentives yield significantly high net surplus to the state budget. The parameter representing the ability of incentives to attract investors seems to be one of the most important components of the correct calculation. Another important point is a necessity of symmetric accounting: some of the other studies implement two expenditures rounds on the side of fiscal benefits, whereas they neglect the second round on the side of costs.

Suggested Citation

  • Peter Bolcha, 2008. "O výpočte fiškálneho dopadu investičnej podpory
    [On calculus of fiscal impact of investment incentives]
    ," Politická ekonomie, University of Economics, Prague, vol. 2008(2), pages 257-274.
  • Handle: RePEc:prg:jnlpol:v:2008:y:2008:i:2:id:640:p:257-274
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    More about this item

    Keywords

    investment incentives; state aid; policy costs; fiscal accounting;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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