Büttner T, Fuest C (2010)
Publication Type: Journal article
Publication year: 2010
Publisher: Springer Verlag (Germany)
Book Volume: 17
Pages Range: 686-698
Journal Issue: 17
URI: https://www.finanzwissenschaft.rw.fau.de/files/2020/03/Stabilization-Germany-09-07.pdf
DOI: 10.1007/s10797-010-9155-7
This paper analyses the effectiveness of the corporate income tax as an automatic stabilizer. It employs a unique firm-level data set of German manufacturers combining financial statements with firm-specific information about credit market restrictions. The results show that approximately 20 per cent of all firms report both positive taxable income and capital market restrictions. Taking account of the income tax rates and the size differences of the firms, we find that demand stabilization through the corporate income tax amounts to about 8 per cent of an initial shock to gross revenues. This stabilization effect varies over the business cycle and tends to increase during cyclical downturns. © 2010 Springer Science+Business Media, LLC.
APA:
Büttner, T., & Fuest, C. (2010). The Role of the Corporate Income Tax as an Automatic Stabilizer. International Tax and Public Finance, 17(17), 686-698. https://dx.doi.org/10.1007/s10797-010-9155-7
MLA:
Büttner, Thiess, and Clemens Fuest. "The Role of the Corporate Income Tax as an Automatic Stabilizer." International Tax and Public Finance 17.17 (2010): 686-698.
BibTeX: Download