Risk, Income Taxation, and Public Investment Criteria
(1974) , 37 pages
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- Authors
- Abstract
- (en) The use of market prices in evaluation of public investments is studied in a one-commodity two-period model with risk and with personal and corporate income taxes. A general measure of riskiness is proposed and employed. Economies with a complete set of insurance markets and with only bond and common stock markets are studied. In general, simple public investment criteria based on market prices exist only under special conditions. Things are simplified if, for instance, all personal tax rates are equal and if the returns to the proposed investment can be related to the average returns to private investments.
- Affiliations
Citations
Schmalensee, R. (1974). Risk, Income Taxation, and Public Investment Criteria (Working Papers Institut des sciences économiques 7413). https://hdl.handle.net/2078.5/275724