Inflation, Tax Rules, and Capital Formation (National Bureau of Economic Research Monograph)

Inflation, Tax Rules, and Capital Formation brings together fourteen papers that show the importance of the interaction between tax rules and monetary policy. Based on theoretical and empirical research, these papers emphasize the importance of including explicit specifications of the tax system in such study. Contents......Page 8 Preface......Page 10 1. An Introductory Overview......Page 12 Part I Inflation and Tax Rules in Macroeconomic Equilibrium......Page 26 2. A Summary of the Theoretical Models......Page 28 3. Inflation, Income Taxes, and the Rate of Interest: A Theoretical Analysis......Page 39 4. Inflation and Taxes in a Growing Economy with Debt and Equity Finance......Page 55 5. Fiscal Policies, Inflation, and Capital Formation......Page 72 6. Inflation, Tax Rules, and the Accumulation of Residential and Nonresidential Capital......Page 92 Part II Inflation and Effective Tax Rules......Page 110 7. Inflation and the Excess Taxation of Capital Gains on Corporate Stock......Page 112 8. Inflation and the Taxation of Capital Income in the Corporate Sector......Page 127 Part III Interest Rates and Asset Yields......Page 162 9. Inflation, Tax Rules, and the Long-term Interest Rate......Page 164 10. Inflation and the Stock Market......Page 197 11. Inflation, Tax Rules, and the Stock Market......Page 210 12. Inflation, Tax Rules, and the Prices of Land and Gold......Page 232 13. Inflation, Portfolio Choice, and Prices of Land and Corporate Stock......Page 240 Part IV The Effect on Investment......Page 252 14. Inflation, Tax Rules, and Investment......Page 254 References......Page 298 Index......Page 308 The research presented in this volume combines the traditional subjects of macroeconomics and public finance. From macroeconomics comes a concern with the rate of interest, the capital intensity of production, and the impact of monetary policy. From public finance comes an emphasis on the significance of the distortionary tax rules that have generally been ignored in macroeconomics analysis and a concern with the effects of tax rules and monetary policy in the distribution of income and on the value of assets. The results of this research show the importance of the interaction between tax rules and monetary policy and the importance of including explicit specifications of the tax system in the study of macroeconomic equilibrium. Martin Feldstein. Includes Index. Bibliography: P. 287-296.