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Taxation and Corporate Policy Under Uncertainty

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  • Carmen Carrera

Abstract

This paper analyzes the firm's choices of capital stock and mode of finance under uncertainty in the presence of personal and corporate taxation. The model allows for full progressivity in personal taxes and the existence of legal constraints on the corporation's use of financial sources. Shareholder's preferences for dividends and general financial policy are characterized by reference to their personal marginal tax rates.

Suggested Citation

  • Carmen Carrera, 1986. "Taxation and Corporate Policy Under Uncertainty," Working Paper 651, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:651
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