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The Johansson-Samuelson Theorem in General Equilibrium: A Rebuttal

  • Francesco Menoncin
  • Paolo M. Panteghini

The well-know Johansson-Samuelson Theorem proves that, in partial equilibrium, comprehensive income taxation with a uniform tax rate is neutral in terms of investment decisions, if fiscal depreciation allowances coincide with economic depreciation. In this article we show that this result does not hold in general equilibrium, unless fairly restrictive conditions are met.

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Paper provided by University of Brescia, Department of Economics in its series Working Papers with number 0806.

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Date of creation: 2008
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Handle: RePEc:ubs:wpaper:0806
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