Essays on firm dynamics and taxation

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F67985998%3A_____%2F25%3A00627725" target="_blank" >RIV/67985998:_____/25:00627725 - isvavai.cz</a>

Výsledek na webu

<a href="https://www.cerge-ei.cz/pdf/dissertations/Dissertation_Final_Stojanovic_Danilo.pdf" target="_blank" >https://www.cerge-ei.cz/pdf/dissertations/Dissertation_Final_Stojanovic_Danilo.pdf</a>

DOI - Digital Object Identifier

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Jazyk výsledku

angličtina

Název v původním jazyce

Essays on firm dynamics and taxation

Popis výsledku v původním jazyce

In the first chapter, I show that the U.S. economy benefits from the 2003 tax cuts on dividends and capital gains. In my general equilibrium model, the tax reform reduces the costs of equity issuance, while dividend adjustment costs and a capital-adjusted limit on repurchases drive changes in dividends and repurchases. The tax reform stimulates small, productive firms to increase capital investment by borrowing more from shareholders. Large, less productive firms respond by reducing investment to finance increased payouts to shareholders. This capital reallocation increases aggregate productivity gains, with a part of increased payouts directed to consumption. In the second chapter, we show that increased firm-specific profit uncertainty reduces capital investment. Quantile regressions reveal this effect is stronger at a higher level of investment for firms facing financing constraints compared to those with irreversible capital. Our general equilibrium model evaluates the impact of frictions and their role in transmitting the uncertainty shocks on real and financial outcomes. Firms reduce investment and increase cash holdings to avoid costly borrowing and irreversible capital adjustments. In the third chapter, we study the influence of changes in firms’ entry, exit and borrowing on the propagation of tax shocks in the U.S. economy. We apply a proxy-SVAR model to isolate exogenous variations in tax changes. The model indicates that corporate income tax cuts increase capital accumulation, which relaxes collateral constraints and provides firms with additional funds. These funds sustain initial tax stimulative effects on aggregate productivity and output growth.

Název v anglickém jazyce

Essays on firm dynamics and taxation

Popis výsledku anglicky

In the first chapter, I show that the U.S. economy benefits from the 2003 tax cuts on dividends and capital gains. In my general equilibrium model, the tax reform reduces the costs of equity issuance, while dividend adjustment costs and a capital-adjusted limit on repurchases drive changes in dividends and repurchases. The tax reform stimulates small, productive firms to increase capital investment by borrowing more from shareholders. Large, less productive firms respond by reducing investment to finance increased payouts to shareholders. This capital reallocation increases aggregate productivity gains, with a part of increased payouts directed to consumption. In the second chapter, we show that increased firm-specific profit uncertainty reduces capital investment. Quantile regressions reveal this effect is stronger at a higher level of investment for firms facing financing constraints compared to those with irreversible capital. Our general equilibrium model evaluates the impact of frictions and their role in transmitting the uncertainty shocks on real and financial outcomes. Firms reduce investment and increase cash holdings to avoid costly borrowing and irreversible capital adjustments. In the third chapter, we study the influence of changes in firms’ entry, exit and borrowing on the propagation of tax shocks in the U.S. economy. We apply a proxy-SVAR model to isolate exogenous variations in tax changes. The model indicates that corporate income tax cuts increase capital accumulation, which relaxes collateral constraints and provides firms with additional funds. These funds sustain initial tax stimulative effects on aggregate productivity and output growth.

Druh

O - Ostatní výsledky

CEP obor

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OECD FORD obor

50202 - Applied Economics, Econometrics

Projekt

<a href="/cs/project/LX22NPO5101" target="_blank" >LX22NPO5101: Národní institut pro výzkum socioekonomických dopadů nemocí a systémových rizik</a><br>

Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2025

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů