Taxation and the Birth of Foreign Subsidiaries
The paper studies the influence of tax policy on foreign direct investment with a particular emphasis on immature subsidiaries. Among other things it shows that taxes on repatriations reduce the subsidiary's "birth weight", that lump sum taxes reduce its cost of capital, and that the possibility of deferral increases this cost. The paper rejects the popular weighted average specification of the subsidiary's cost of capital.
|Date of creation:||Nov 1990|
|Date of revision:|
|Publication status:||published as Herberg, Horst and Ngo Van Long (eds.) Trade, welfare, and economic policies: Papers in Honour of Murray C . Kemp. Ann Arbor: Michigan University Press, 1993.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- J. S. S. Edwards & M. J. Keen, 1984. "Wealth Maximization and the Cost of Capital: A Comment," The Quarterly Journal of Economics, Oxford University Press, vol. 99(1), pages 211-214.
- Sinn, Hans-Werner, 1984. "Die Bedeutung des Accelerated Cost Recovery System fur den internationalen Kapitalverkehr. (The Significance of the Accelerated Cost Recovery System for International Capital Movements. With English s," Kyklos, Wiley Blackwell, vol. 37(4), pages 542-76.
- Assaf Razin & Joel Slemrod, 1990. "Taxation in the Global Economy," NBER Books, National Bureau of Economic Research, Inc, number razi90-1, March.
- Howitt, Peter & Sinn, Hans-Werner, 1989.
"Gradual Reforms of Capital Income Taxation,"
American Economic Review,
American Economic Association, vol. 79(1), pages 106-24, March.
- Joosung Jun, 1989. "Tax Policy and International Direct Investment," NBER Working Papers 3048, National Bureau of Economic Research, Inc.
- Murray C. Kemp, 1962. "Foreign Investment And The National Advantage," The Economic Record, The Economic Society of Australia, vol. 38(81), pages 56-62, 03.
- King, Mervyn A, 1974. "Dividend Behaviour and the Theory of the Firm," Economica, London School of Economics and Political Science, vol. 41(161), pages 25-34, February.
- Hugh J. Ault & David F. Bradford, 1990.
"Taxing International Income: An Analysis of the U.S. System and Its Economic Premises,"
in: Taxation in the Global Economy, pages 11-52
National Bureau of Economic Research, Inc.
- David F. Bradford & Hugh J. Ault, 1989. "Taxing International Income: An Analysis of the U.S. System and Its Economic Premises," NBER Working Papers 3056, National Bureau of Economic Research, Inc.
- Stiglitz, Joseph E., 1973. "Taxation, corporate financial policy, and the cost of capital," Journal of Public Economics, Elsevier, vol. 2(1), pages 1-34, February.
- Alan J. Auerbach, 1980.
"Wealth Maximization and the Cost of Capital,"
NBER Working Papers
0254, National Bureau of Economic Research, Inc.
- Bagwell, Laurie Simon & Shoven, John B, 1989. "Cash Distributions to Shareholders," Journal of Economic Perspectives, American Economic Association, vol. 3(3), pages 129-40, Summer.
- David F. Bradford, 1979.
"The Incidence and Allocation Effects of a Tax on Corporate Distributions,"
NBER Working Papers
0349, National Bureau of Economic Research, Inc.
- Bradford, David F., 1981. "The incidence and allocation effects of a tax on corporate distributions," Journal of Public Economics, Elsevier, vol. 15(1), pages 1-22, February.
- Horst, Thomas, 1977. "American Taxation of Multinational Firms," American Economic Review, American Economic Association, vol. 67(3), pages 376-89, June.
- King, Mervyn, 1989. "Economic growth and the life-cycle of firms," European Economic Review, Elsevier, vol. 33(2-3), pages 325-334, March.
- Mitsuo Sato & Richard M. Bird, 1975. "International Aspects of the Taxation of Corporations and Shareholders (Aspects internationaux de l'imposition des sociÃ©tÃ©s et des actionnaires) (Aspectos internacionales de la tributaciÃ³n de socie," IMF Staff Papers, Palgrave Macmillan, vol. 22(2), pages 384-455, July.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:3519. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.