Download or read book Effectiveness of Fiscal Incentives for R D written by Irem Guceri and published by International Monetary Fund. This book was released on 2017-03-31 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: With growing academic and policy interest in research and development (R&D) tax incentives, the question about their effectiveness has become ever more relevant. In the absence of an exogenous policy reform, the simultaneous determination of companies’ tax positions and their R&D spending causes an identification problem in evaluating tax incentives. To overcome this identification challenge, we exploit a U.K. policy reform and use the population of corporation tax records that provide precise information on the amount of firm-level R&D expenditure. Using difference-in-differences and other panel regression approaches, we find a positive and significant impact of tax incentives on R&D spending, and an implied user cost elasticity estimate of around -1.6. This translates to more than a pound in additional private R&D for each pound foregone in corporation tax revenue.

Download or read book The Impact and Effectiveness of Fiscal Incentives for R D written by C. Köhler and published by . This book was released on 2001 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper is part of the Compendium of Evidence on the Effectiveness of Innovation Policy Intervention. It reviews the experience of business research and development (R & D) tax incentives in OECD countries and presents findings on using this instrument for achieving certain R & D policy objectives. Based on economic and policy rationales for R & D tax incentives, design features of the instrument are discussed which contribute to its flexibility and its ability to address different policy objectives. The main part of the paper summarizes the results of evaluations of R & D fiscal incentives. Most studies focus on input additionality - the contribution of the tax incentive to increased business R & D expenditure while there is less evidence on output additionality - the effects of R & D tax incentives on innovation and economic impact. Evaluation results are linked to design features of the evaluated instruments to derive conclusions about how R & D tax incentives can be designed for meeting particular policy goals.

Download or read book How Effective are Fiscal Incentives for R D written by Bronwyn H. Hall and published by . This book was released on 1999 with total page 68 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper surveys the econometric evidence on the effectiveness of fiscal incentives for research and development (R&D). The authors describe the effects of tax systems in OECD countries on the user cost of R&D - the current position, changes over time and across different firms in different countries. The authors describe and criticize the methodologies used to evaluate the effect of the tax system on R&D behaviour and the results from different studies. In the current (imperfect) state of knowledge they conclude that a dollar in tax credit for R&D stimulates a dollar of additional R&D.

Download or read book How Does the Evolution of R D Tax Incentives Schemes Impact Their Effectiveness written by Florence Blandinieres and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Fiscal Incentives for Investment and Innovation written by Anwar Shah and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Developing countries continue to make widespread use of tax policy instruments to promote industrial and technological development. The actual effect of these instruments on business activity and government revenues, however, remains an open question. The studies presented in this volume take an important first step in quantifying the effect of investment incentives on business decisions related to production and investment. In addition, they suggest the consequences of such incentives for government revenues. The analyses presented in subsequent chapters attempt to answer a narrow set of questions. The most fundamental of these questions is: Do taxes matter for investment? Related questions include: - What have been the investment stimulation (direct and induced) effects of tax policy measures per dollar of forgone revenues? - Do taxes matter for foreign direct investment (FDI) in developing countries? Do they influence foreign business decisions about location? - What are the implications of the home (industrial) country tax regime for the host (developing) country tax system? - How do taxes interact with other institutional features of a developing country, and what are the implications for the effectiveness of tax incentives? Are corporate taxes largely ineffective (nonmarginal) instruments because of the influence of other policy instruments? - Do taxes matter for domestic investment? What is their effect on the structure of industrial production? - What has been the effect of tax instruments on the employment of labor, physical capital, and research and development (R&D) capital? - What has been the effect of business taxes and tax expenditures (forgone revenues) on technological change, expansion of private output, and after-tax profits? - Are there tax-induced distortions that prevent firms from holding optimal levels of fixed factors? - How does market power affect tax incentives? - What is the role of expectations in investment decisions? - Given empirical estimates on factor substitution, the nature of technical change, and economies of scale, what revenue-neutral alternative tax policy environment would best encourage investment and enhance productivity and growth? The papers presented in this volume reflect on the above questions at both conceptual and empirical levels and in doing so pay close attention to the tax and nontax policy elements and the existing institutions (market imperfections) in developing and emerging market economies. In the next section the case for tax policy interventions in the marketplace is examined briefly.

Download or read book Rethinking Property Tax Incentives for Business written by Daphne A. Kenyon and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The use of property tax incentives for business by local governments throughout the United States has escalated over the last 50 years. While there is little evidence that these tax incentives are an effective instrument to promote economic development, they cost state and local governments $5 to $10 billion each year in forgone revenue. Three major obstacles can impede the success of property tax incentives as an economic development tool. First, incentives are unlikely to have a significant impact on a firm's profitability since property taxes are a small part of the total costs for most businesses--averaging much less than 1 percent of total costs for the U.S. manufacturing sector. Second, tax breaks are sometimes given to businesses that would have chosen the same location even without the incentives. When this happens, property tax incentives merely deplete the tax base without promoting economic development. Third, widespread use of incentives within a metropolitan area reduces their effectiveness, because when firms can obtain similar tax breaks in most jurisdictions, incentives are less likely to affect business location decisions. This report reviews five types of property tax incentives and examines their characteristics, costs, and effectiveness: property tax abatement programs; tax increment finance; enterprise zones; firm-specific property tax incentives; and property tax exemptions in connection with issuance of industrial development bonds. Alternatives to tax incentives should be considered by policy makers, such as customized job training, labor market intermediaries, and business support services. State and local governments also can pursue a policy of broad-based taxes with low tax rates or adopt split-rate property taxation with lower taxes on buildings than land.State policy makers are in a good position to increase the effectiveness of property tax incentives since they control how local governments use them. For example, states can restrict the use of incentives to certain geographic areas or certain types of facilities; publish information on the use of property tax incentives; conduct studies on their effectiveness; and reduce destructive local tax competition by not reimbursing local governments for revenue they forgo when they award property tax incentives.Local government officials can make wiser use of property tax incentives for business and avoid such incentives when their costs exceed their benefits. Localities should set clear criteria for the types of projects eligible for incentives; limit tax breaks to mobile facilities that export goods or services out of the region; involve tax administrators and other stakeholders in decisions to grant incentives; cooperate on economic development with other jurisdictions in the area; and be clear from the outset that not all businesses that ask for an incentive will receive one.Despite a generally poor record in promoting economic development, property tax incentives continue to be used. The goal is laudable: attracting new businesses to a jurisdiction can increase income or employment, expand the tax base, and revitalize distressed urban areas. In a best case scenario, attracting a large facility can increase worker productivity and draw related firms to the area, creating a positive feedback loop. This report offers recommendations to improve the odds of achieving these economic development goals.

Download or read book The Effectiveness and Fiscal Impact of Tax Incentives for Historic Preservation written by John E. Petersen and published by . This book was released on 1988 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Making Sense of Incentives written by Timothy J. Bartik and published by W.E. Upjohn Institute. This book was released on 2019-10-15 with total page 180 pages. Available in PDF, EPUB and Kindle. Book excerpt: Bartik provides a clear and concise overview of how state and local governments employ economic development incentives in order to lure companies to set up shop—and provide new jobs—in needy local labor markets. He shows that many such incentive offers are wasteful and he provides guidance, based on decades of research, on how to improve these programs.

Download or read book The Impact of Financial Incentives on Individual Performance An Experimental Approach written by Steffen Hetzel and published by GRIN Verlag. This book was released on 2011-08-04 with total page 85 pages. Available in PDF, EPUB and Kindle. Book excerpt: Diploma Thesis from the year 2010 in the subject Economics - Job market economics, grade: 1,3, University of Mannheim, language: English, abstract: The thesis on hand is dealing with the impact of financial incentives on individual performance. For this, the perception of an experimental approach has been chosen. The target of the thesis is the development of the blueprint of an experiment to provide further research input on the effectiveness of financial incentives. To do so, the theoretical background for studying this problem is introduced by investigating the psychological and economical approaches to analyze the topic. Additionally, empirical and experimental studies dealing with this issue are presented. Based on those findings, the structure of an experiment to be carried out at university with students is developed and objectives, design and supplementary requirements for conducting this are discussed. Subsequent, suggestions for the analysis, reporting and possibly occurring challenges throughout the process of implementation are illustrated. The design of the experiment is giving a verification of before detected findings of a non-linear correlation between incentives and performance. In contrary to standard economic models, the relation is not predicted to be monotonic, but S-shaped. For this perspective, not only performance on varying incentive levels is analyzed, but also performance if payments are absent. Furthermore, the influence of publishing the course of incentive levels in the beginning of the experiment, in comparison to a task-to-task announcement is investigated. An evaluation of this relation is undertaken by studying the impact of financial incentives on performance of three observation groups through two different exercises with varying incentive levels during a real-effort experiment.

Download or read book Effectiveness of Fiscal Incentives for R D written by Irem Guceri and published by International Monetary Fund. This book was released on 2017-03-31 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: With growing academic and policy interest in research and development (R&D) tax incentives, the question about their effectiveness has become ever more relevant. In the absence of an exogenous policy reform, the simultaneous determination of companies’ tax positions and their R&D spending causes an identification problem in evaluating tax incentives. To overcome this identification challenge, we exploit a U.K. policy reform and use the population of corporation tax records that provide precise information on the amount of firm-level R&D expenditure. Using difference-in-differences and other panel regression approaches, we find a positive and significant impact of tax incentives on R&D spending, and an implied user cost elasticity estimate of around -1.6. This translates to more than a pound in additional private R&D for each pound foregone in corporation tax revenue.

Download or read book Fiscal Incentives and Firm Performance written by Alessandra Amendola and published by . This book was released on 2018 with total page 23 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper evaluates the impact of fiscal incentives on firm performance in the Dominican Republic. In recent years, the Dominican government has approved several new corporate tax benefits. While the literature on value-added tax incentives is extensive, the impact of corporate tax incentives is less well studied and is the subject of an ongoing debate. Using firm-level panel data from 2006 to 2015, this analysis uses fixed- and random-effects models to examine the relationship between corporate tax incentives and selected firm-level performance indicators. The results reveal that corporate income tax exemptions positively impact the performance of individual firms in the Dominican Republic, but uneven tax treatment across firms distorts competition in the industrial sector, with negative effects on overall economic productivity.

Download or read book Empirical Evidence on the Effects of Tax Incentives written by Alexander Klemm and published by International Monetary Fund. This book was released on 2009-07 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: The growth literature has had problems explaining the "sub-Saharan African growth dummy" in cross-country regressions. Instead of taking the usual approach of focusing on long-run growth and assuming that sub-Saharan countries have homogenous parameters in growth regressions, we concentrate our analysis on episodes of growth turnarounds (identifying growth accelerations, decelerations, and collapses) and use only West African countries in our sample. The driving force of growth turnarounds are estimated by analyzing external shocks, political and institutional changes, economic reforms, and indicators particularly relevant to the region. Using probits for a group of 22 Western African economies for the period 1960-2006, we find that growth accelerations are most clearly associated with external shocks, economic liberalization, political stability, and closeness to the coast; decelerations occurred during short-lived regimes and when corruption indices weakened; and collapses are linked to external shocks, falling domestic credit, and proximity to the coast. We then identify policy implications.

Download or read book Identifying Technology Spillovers and Product Market Rivalry written by Nicholas Bloom and published by . This book was released on 2005 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Tax Incentives and Economic Growth written by Barry Bosworth and published by Brookings Institution Press. This book was released on 1984 with total page 208 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Incentive Effects of R D Tax Incentives written by Carla Pöschel and published by . This book was released on 2020 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Despite the growing literature on the effectiveness of research and development (R&D) tax incentives, little is known about the differing design aspects of the underlying tax policies. In this paper, I apply meta-regression analysis (MRA) to separate the distinct provisions through which various tax schemes affect firms' R&D expenditures. Using 192 estimates from 19 studies exploiting the direct approach, the results indicate, on average, greater input additionality effects of hybrid regimes in comparison to volume-based and incremental ones. MetaForest, a novel machine learning algorithm, confirms these results: the moderator for hybrid schemes is the most important variable in explaining the heterogeneity among estimates. Unlike previous MRA, I find only weak evidence for publication bias in this stream of literature. Overall, the relation between tax incentives and R&D expenditures is positive, on average, but the strength varies with methodological variations across studies.

Download or read book Handbook of Innovation Policy Impact written by Jakob Edler and published by Edward Elgar Publishing. This book was released on 2016-07-27 with total page 604 pages. Available in PDF, EPUB and Kindle. Book excerpt: Innovation underpins competitiveness, is crucial to addressing societal challenges, and its support has become a major public policy goal. But what really works in innovation policy, and why? This Handbook, compiled by leading experts in the field, is the first comprehensive guide to understanding the logic and effects of innovation polices. The Handbook develops a conceptualisation and typology of innovation policies, presents meta-evaluations for 16 key innovation policy instruments and analyses evidence on policy-mix. For each policy instrument, underlying rationales and examples are presented, along with a critical analysis of the available impact evidence. Providing access to primary sources of impact analysis, the book offers an insightful assessment of innovation policy practice and its evaluation.

Download or read book How Tax Policy and Incentives Affect Foreign Direct Investment written by Jacques Morisset and published by World Bank Publications. This book was released on 2000 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Tax incentives neither make up for serious deficiencies in a country's investment environment nor generate the desired externalities. But when other factors, such as infrastructure, transport costs, and political and economic stability are more or less equal, the taxes in one location may have a significant effect on investors' choices. This effect varies, however, depending on the tax instrument used, the characteristics of the multinational company, and the relationship between the tax systems of the home and recipient countries.