000			03268cam a22003377 4500
001			w3139
003			NBER
005			20211020114818.0
006			m o d
007			cr cnu||||||||
008			210910s1989 mau fo 000 0 eng d
100	1		_aBovenberg, A. Lans.
245	1	0	_aPromoting Investment under International Capital Mobility: _bAn Intertemporal General Equilibrium Analysis / _cA. Lans Bovenberg, Lawrence H. Goulder.
260			_aCambridge, Mass. _bNational Bureau of Economic Research _c1989.
300			_a1 online resource: _billustrations (black and white);
490	1		_aNBER working paper series _vno. w3139
500			_aOctober 1989.
520	3		_aThis paper uses a dynamic computable general equilibrium model to compare, in an economy open to international capital flows, the effects of two U.S. policies intended to promote domestic capital formation. The two policies -- the introduction of an investment tax credit (ITC) and a reduction in the statutory corporate income tax rate -- differ in their treatment of old (existing) and new capital. The model features adjustment dynamics, intertemporal optimization by U.S. and foreign households and firms endowed with model-consistent expectations, imperfect substitution between domestic and foreign assets in portfolios, an integrated treatment of the current and capital accounts of the balance of payments, and industry disaggregation in the United States. We find that the two policies (scaled to imply the same revenue cost) differ in their consequences for foreign and domestic welfare, the balance of payments accounts, international competitiveness, and U.S. industrial structure. The ITC produces larger domestic welfare gains because it is more effective in reducing intertemporal distortions, while the two policies have similar implications for intersectoral efficiency. From the point of view of domestic welfare, the relative attractiveness of the ITC is enhanced when international capital mobility is taken into account, a reflection of international transfers of wealth associated with foreign ownership of part of the U.S. capital stock. Whereas reducing the corporate tax rate improves the trade balance initially, introducing the ITC causes a deterioration of the trade balance in the short run. Reflecting a lower real exchange rate, export-oriented sectors perform better relative to non-tradable industries under a lower corporate tax rate than in the presence of the lTC, especially in the short run.
530			_aHardcopy version available to institutional subscribers
538			_aSystem requirements: Adobe [Acrobat] Reader required for PDF files.
538			_aMode of access: World Wide Web.
588	0		_aPrint version record
690		7	_aE - Macroeconomics and Monetary Economics _2Journal of Economic Literature class.
690		7	_aF - International Economics _2Journal of Economic Literature class.
700	1		_aGoulder, Lawrence H. _911718
710	2		_aNational Bureau of Economic Research.
830		0	_aWorking Paper Series (National Bureau of Economic Research) _vno. w3139.
856	4	0	_uhttps://www.nber.org/papers/w3139
856			_yAcceso en línea al DOI _uhttp://dx.doi.org/10.3386/w3139
942			_2ddc _cW-PAPER
999			_c345381 _d303943