Can corporate taxation be explained by limited liability?

Miglo, A ORCID: https://orcid.org/0000-0002-9237-5293 2010, 'Can corporate taxation be explained by limited liability?' , in: Taxation, tax policies and income taxes , Monetary, fiscal and trade policies , Nova Science, pp. 201-205.

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Abstract

We consider a model where wealth-constrained entrepreneurs have private information about the qualities of available investment projects. We show that some "high risk-high return" projects will receive external financing even if they are not socially profitable. Some "low risk-low return" projects will not be funded even if they are socially profitable. Government interventions can improve equilibrium. Optimal government policy may include corporate taxation, subsidies or other instruments. A universal tax on all entrepreneurs with limited liability is not optimal.

Item Type:	Book Section
Editors:	Berube, WJ and Pinto, CN
Schools:	Schools > Salford Business School
Journal or Publication Title:	Taxation, Tax Policies and Income Taxes
Publisher:	Nova Science
Series Name:	Monetary, fiscal and trade policies
ISBN:	9781607416265 (hardback)
Related URLs:	Publisher
Depositing User:	Dr Anton Miglo
Date Deposited:	25 May 2021 15:32
Last Modified:	27 Aug 2021 21:53
URI:	http://usir.salford.ac.uk/id/eprint/60384

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