Entrepreneurship and the theory of taxation

A review of the literature on firm taxation reveals that the economics of entrepreneurship has not sufficiently been taken into consideration. We discuss how this affects conclusions derived from standard models of capital taxation when applied to entrepreneurial income. Some defining features of entrepreneurship important for analyzing the effects of taxation of owner-managed firms are identified. These include the lack of a well-functioning external market for entrepreneurial effort, limited access to external capital and complementarities between entrepreneurial innovation, effort and capital. Due to these constraints, the entrepreneurial project is tied to the individual owner–manager. The entrepreneur is unable to decouple saving decisions from investment decisions, and makes joint decisions on the supply of effort and capital. The return from successful entrepreneurial ventures can therefore not be readily divided into labor and capital income, in deep contrast to what is typically assumed in taxation theory. It is argued that when distinct attributes of entrepreneurship are taken into account, certain conclusions of capital taxation models may no longer hold, including the neutrality of capital taxation in owner-managed firms. Cost of capital formulas derived from the behavior of public firms could underestimate distortions when applied to the investment behavior of entrepreneurial firms. For tax purposes and otherwise, it becomes useful to analyze return to entrepreneurial activity as income of a distinct factor of production. In this context, conceptual issues and the difficulties of measuring entrepreneurial income are discussed.     

Factors affecting the acquisition and transfer of novel attribute relationships to new product categories

This article investigates two factors posited to affect consumers' ability to learn a novel attribute relationship (e.g., “no pesticides → USDA organic symbol”) and apply this recently acquired knowledge when making judgments in a new product category. The first factor concerns the nature of the attribute encoding process and, in particular, whether it allows for comparison of examples. The second factor focuses on the relationship between the learning and transfer domains, and examines the influence of perceptual similarity (manipulated two ways: similarity in the elements comprising the attribute relationships, and similarity between the base and target domains) on the transfer process. Study 1 revealed a significant improvement in inter‐domain transfer when a relationship was learned in a multiple‐domain/multiple‐attribute learning environment over a single‐domain/single‐attribute environment. When attribute and domain diversity were examined separately (Study 2), it was found that attribute, but not domain, diversity produced the greatest improvements in transfer. Study 3 showed that the benefits of adding a perceptual similarity cue were most apparent when the transfer conditions were neither too easy (within domain and within attribute) nor too difficult (inter‐domain and inter‐attribute). © 2009 Wiley Periodicals, Inc.     

Contents of Volume 47

Volume Contents

Contents of Volume 47     

Contents of Volume 14

Volume Contents

Contents of Volume 14     

什么推动了新兴国家的经济增长?

当一个国家找到符合其自身具比较优势、值得投资的产业后,其国内经济的发展速度将由储蓄及投资水平来决定。     

The Effects of Average Norm Model Regulation: The Case of Electricity Distribution in Sweden

Following the reform of energy sectors, some countries have used engineering norm models in incentive regulation of network utilities. In 2003, Sweden adopted this approach to regulation of electricity distribution networks. This paper examines whether the norm models represent the real networks and create incentives for performance improvement. We analyse data from 138 network concession holders between 2000 and 2007. The results show that norm models are not adequate representations of real networks. Also, utilities that perform better than their norm models tend to behave opportunistically. Finally, we find that private utilities respond more strongly to incentives.     

Regime-switching and interest rates in the European monetary system

This paper examines the impact that a currency target zone has on short-term interest rates. For a number of countries in the European Monetary System, we characterize the short rate using a regime-switching model that allows for a differently parameterized mean-reverting square-root process in each regime. We find that the volatility, the level, and the speed-of-adjustment are all higher in the regime that is operative during speculative attacks and currency crises. Moreover, we allow the conditional probability of being in each regime to be state-dependent so the model can be used to examine questions relating to the likelihood of realignments and the stability of the target zone system.     

The use and development of indicators for the commercialisation of university research in a national support programme

Governments in most countries have set up specialised programmes to support the commercialisation of academic research. A key challenge is to develop indicators that are able to measure operation and impact. This study shows how different indicators are used to satisfy different stakeholders of a Norwegian support programme. Policy intervention is supposed to lead to additionality related to input, behaviour and output. While the support programme uses input and behavioural measures as strategic tools for its operation, policy makers are mostly preoccupied with output measures. This study illustrates how indicators develop over time, partly co-evolving with the development of the programme and the national commercialisation infrastructure. Indicators serve as incentives for the agents involved, but they may also influence the strategies of the programme that established them. The external signalling effect of indicators remains central, while its use in daily operations becomes less important with time and experience.     

Mind over matter? The inability to counteract contrast effects despite conscious effort

The nature of contrast effects is equivocal. Prior research has conceptualized contrast effects as emerging from an effortful attempt to counteract the natural tendency to assimilate to relevant contextual information. Others have suggested that contrast effects can be the natural, default outcome if the context stimulus is extreme relative to the target. Even with this latter perspective, however, individuals are believed to be sufficiently aware of the contextual influence so as to be able to counteract it if so motivated. These conceptualizations call into question the extent to which contrast effects can occur automatically, without awareness. By using an opposition paradigm that pits automatic influences against conscious influences, unequivocal evidence is provided that contrast effects can occur automatically; contrast effects emerged even when the contextual information was not accessible from memory and study participants were explicitly trying to avoid the influence of contextual information. Explanations are proffered as to why evaluations driven by automatic contrast effects could be inconsistent with preference judgments. © 2005 Wiley Periodicals, Inc.