A Note on Corporate Taxation, Limited Liability and Asymmetric Information

Miglo, Anton (2007) A Note on Corporate Taxation, Limited Liability and Asymmetric Information. Journal of Economics, 92 (1). pp. 11-19. ISSN 0931-8658

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Abstract

Becker and Fuest (forthcoming) provides a new explanation for the important and puzzling link between limited liability and corporate taxation. The authors argue that a corporate tax on all entrepreneurs with limited liability is optimal when entrepreneurs can offset potential losses and when asymmetric information exists regarding projects' qualities. This note considers a model with slightly modified production technology. It confirms that entrepreneurs' abilities to offset losses and the existence of asymmetric information may affect government policy. However, it also shows that the optimal taxation policy differs from that in Becker and Fuest (forthcoming).

Item Type:	Article
Dates:	Date Event 18 April 2007 Accepted 20 August 2007 Published Online 2007 Published
Subjects:	CAH15 - social sciences > CAH15-02 - economics > CAH15-02-01 - economics CAH17 - business and management > CAH17-01 - business and management > CAH17-01-02 - business studies CAH17 - business and management > CAH17-01 - business and management > CAH17-01-04 - management studies CAH17 - business and management > CAH17-01 - business and management > CAH17-01-07 - finance
Divisions:	Faculty of Business, Law and Social Sciences > College of Accountancy, Finance and Economics Faculty of Business, Law and Social Sciences > College of Business, Digital Transformation & Entrepreneurship
Depositing User:	Anton Miglo
Date Deposited:	13 Aug 2018 07:52
Last Modified:	20 Jun 2024 12:07
URI:	https://www.open-access.bcu.ac.uk/id/eprint/6211