Tax, stimuli of investment and firm value

Research output: Contribution to journalArticlepeer-review


Pennings (2000, European Economic Review, 44, pp. 383-91) has shown that the government can speed up investment by subsidizing the potential investing firm's entry cost while taxing the future proceeds from the investment, so as to render the net expected value of its subsidy program zero. This note argues that while speeding up investment, this subsidy-tax program also lowers the value of the firm and therefore will be rejected by it.

Original languageEnglish
Pages (from-to)171-174
Number of pages4
Issue number1
StatePublished - Feb 2011


Dive into the research topics of 'Tax, stimuli of investment and firm value'. Together they form a unique fingerprint.

Cite this