Taxation and Incentives to Innovate: A Principal-Agent Approach

d’Andria, Diego

doi:10.1628/001522116x14557023949337

Cited by 8 publications

(3 citation statements)

References 23 publications

(26 reference statements)

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“…Effects of Patent Box are mixed. There are studies with positive empirical evidence on innovation outcomes [2,5,47], country performance [15], company performance [1], and others. Negative effects such as shift profits [26,45] and raise complexities in tax administrations [38] were found too.…”

Section: Discussionmentioning

confidence: 99%

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What’s Happening with the Patent Box Regimes? A Systematic Review

2022

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Patent Box regimes are a tax relief incentive promoted by governments to encourage the R&D activities of enterprises. The literature developed on Patent Box is still examining the effects on certain economic variables. Thus, this research conducted a systematic review of the Patent Box literature since 2010 and applied regimes worldwide. For this aim, the authors developed a comprehensive systematic review using the PRISMA scheme, analyzed the main scientific characteristics with bibliometrix R-package, and prepared a summary table with the attributes collected from the Patent Box scheme applied worldwide. The findings showed that the Patent Box literature is focused on describing applications on countries and implications, analyzing its effects on company and country performance, or examining its influence on location choices. However, there is no definitive consensus on its effect on innovation or economic outcomes, which finally depends on the design of this scheme. As an applied tool, Patent Box is mainly used in European countries. This review and future updates could help as a reference monitor of the Patent Box mechanism.

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Section: Discussionmentioning

confidence: 99%

“…[21,23]. On the other hand, microeconomic theoretical models about welfare and revenues with effects of different tax schemes [44,47] gave a favorable position about Patent Box on innovation and capital investment.…”

Section: Patent Box: a Complete Reviewmentioning

confidence: 99%

What’s Happening with the Patent Box Regimes? A Systematic Review

2022

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“…Voßmerbäumer, 201;Göx, 2008). The review of literature reveal that only one study, namely D' Andria et al (2016), investigates the impact of R&D incentives within the principal-agency theory. However, this focuses, as in case of other studies, on ST and takes only wages into account, where the investments remain disregarded.…”

Section: Related Literaturementioning

confidence: 99%

The Impact Of Tax Regimes On The Effectiveness Of R&D Allowances - An Investigation Of Separate Taxation And Formula Apportionment Within The Framework Of R&D

Yıldız¹,

Celebi²

2019

34. International Public Finance Conference

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This study investigates the effectiveness of R&D allowances within the framework of different tax regimes, namely Separate Taxation (ST) and Formula Apportionment (FA). In order to take the characteristics of R&D activities as well as the importance of the labor in R&D activities into account, a model within the framework of principalagent setting is designed, where the impact of investments decisions is also investigated. In the model, R&D allowances are represented by means of expenditure-based allowances. Because of the analytical limitations, non-linear optimization and genetic algorithm are used for the investigation of the model designed. The outcomes show significant differences between ST and FA regarding the effectiveness of R&D allowances, impact on the compensation of managers and employees as well as on the welfare of owners (or employers). Under both, with and without R&D, FA enables to achieve a higher total surplus (net profit) compared to ST.

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Tax policy and entrepreneurial entry with information asymmetry and learning

d’Andria

2019

Int Tax Public Finance

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We study a market with entrepreneurial and worker entry where both entrepreneurs' abilities and workers' qualities are private information. We develop an agent-based computable model to mimic the mechanisms described in a previous analytical model (Boadway and Sato in Int Tax Public Finance 18(2):166-192, 2011). Then, we introduce the possibility that agents may learn over time about abilities and qualities of other agents, by means of Bayesian inference over informative signals. We show how such different assumptions affect the optimality of second-best tax and subsidy policies. While with no information, it is optimal to have a subsidy to labour and a simultaneous tax on entrepreneurs to curb excessive entry, with learning the detrimental effects of excessive entry are partly compensated by surplus-increasing faster learning.

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Taxation and Incentives to Innovate: A Principal-Agent Approach

Cited by 8 publications

References 23 publications

What’s Happening with the Patent Box Regimes? A Systematic Review

What’s Happening with the Patent Box Regimes? A Systematic Review

The Impact Of Tax Regimes On The Effectiveness Of R&D Allowances - An Investigation Of Separate Taxation And Formula Apportionment Within The Framework Of R&D

Tax policy and entrepreneurial entry with information asymmetry and learning

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