Inflation,taxes and housing: A theoretical analysis |
| |
Authors: | James B. Kau Donald Keenan |
| |
Affiliation: | University of Georgia, Athens, GA 30602, USA |
| |
Abstract: | This paper examines the real effects of inflation under a distortionary tax system. The presence of a tax subsidy to housing substantially alters the effects of inflation on the capital intensity of production and on the market interest rate. The analysis suggests that not taxing the flow of services from housing has caused inflation to reduce capital intensity, thereby decreasing U.S. productivity. Furthermore, this tax subsidy has caused inflation to raise the real interest rate while reducing the after-tax real returns to assets. |
| |
Keywords: | |
本文献已被 ScienceDirect 等数据库收录! |
|