Arbeitspapier

Do Dividend Taxes Affect Corporate Investment

We test whether dividend taxes affect corporate investments. We exploit Sweden's 2006 dividend tax cut of 10 percentage points for closely held corporations and five percentage points for widely held corporations. Using rich administrative panel data and triple-difference estimators, we find that this dividend tax cut affects allocation of corporate investment. Cash-constrained firms increase investment after the dividend tax cut relative to cash-rich firms. Reallocation is stronger among closely held firms that experience a larger tax cut. This result is explained by higher nominal equity in cash-constrained firms and by higher dividends in cash-rich firms after the tax cut. The heterogeneous investment responses imply that the dividend tax cut raises efficiency by improving allocation of investment.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 4931

Klassifikation
Wirtschaft
Corporate Finance and Governance: General
Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
Business Taxes and Subsidies including sales and value-added (VAT)
Thema
investment
dividend taxation
private firms

Ereignis
Geistige Schöpfung
(wer)
Alstadsæter, Annette
Jacob, Martin
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2014

Handle
Letzte Aktualisierung
10.03.2025, 11:45 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Alstadsæter, Annette
  • Jacob, Martin
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2014

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