A theory of capital gains taxation and business turnover

Resumo

We present a theory concerning the realization of capital gains where ownership and control are linked as in Holmes and Schmitz (J. Pol. Econ. 103: 1005-1038, 1995). The model developed is a version of a Lucas-tree economy in which the productivity of a technology depends on the ownership of the technology. The existence and uniqueness of equilibrium follow from the Contraction Mapping Theorem. The theory implies that impediments to asset trading, such as capital gains taxation, negatively affect production efficiency. Moreover, we calibrate the model economy to U.S. data on small-business turnover and find that indexing deductions for inflation is capable of increasing capital-gains tax revenues.

Ficha do documento

Tipo

Artigo científico

Ano

2007

Instituição

Springer

Fonte

Repositório da FGV

Idioma

Inglês

Acesso

Acesso restrito

DOI

10.1007/s00199-006-0115-5

Identificador

oai:repositorio.fgv.br:10438/23082

Temas

Economia

Palavras-chave

Asset pricesBusiness turnoverTaxationProduction efficiencyCorporate-stockEquilibriumRealizationIndustryEconomiaFinançasInvestimentosImposto sobre o capital