Effects of Patent Protection on Optimal Corporate Income and Consumption Taxes in an R&D-Based Growth Model.

Does reducing the corporate income tax accompanied by an increase in the consumption tax to meet the government's budget constraint improve welfare? To respond, we examine the welfare-maximizing corporate income tax and consumption tax rates in an R&D-based growth model under the constraint that the...

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Publicado en:Southern Economic Journal Vol. 83; no. 2; pp. 590 - 609
Autor principal: Iwaisako, Tatsuro
Formato: Artículo
Publicado: Wiley-Blackwell Oct2016
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Acceso en línea:Ver este registro en EBSCOhost
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        10.1002/soej.12161
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        atl: Effects of Patent Protection on Optimal Corporate Income and Consumption Taxes in an R&D-Based Growth Model.
      aug:
        au: Iwaisako, Tatsuro
        affil: Graduate School of Economics, Osaka University, 1-7 Machikaneyama, Toyonaka
      su:
        Consumption (Economics)
        Economic development
        Technological innovations
        Economic models
        Corporate taxes
        Tax rates
        Research & development
      sug:
        subj:
          Consumption (Economics)
          Economic development
          Technological innovations
          Economic models
          Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
          Research and Development in Biotechnology
          Corporate taxes
          Tax rates
          Research & development
      keyword:
        O34
        O38
        O40
        O34
        O38
        O40
      ab: Does reducing the corporate income tax accompanied by an increase in the consumption tax to meet the government's budget constraint improve welfare? To respond, we examine the welfare-maximizing corporate income tax and consumption tax rates in an R&D-based growth model under the constraint that the government's budget is balanced at each point of time. Further, we consider how welfare-maximizing tax rates change as patent protection becomes stronger, as seen in many countries. The results show that as patent protection becomes stronger, the corporate income tax rate should be higher and the consumption tax rate should be lower. This implies that under stronger patent protection, recovering production at the expense of innovation by raising corporate income tax and reducing consumption tax improves welfare.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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