On the Value and Determinants of the Interest Tax Shields

dc.contributor.author	Menichini, Amilcar A.
dc.date.accessioned	2015-04-08T23:03:12Z
dc.date.available	2015-04-08T23:03:12Z
dc.date.issued	2014-11-13
dc.identifier.uri	https://hdl.handle.net/10945/44908
dc.description	SSRN-id2499835	en_US
dc.description.abstract	We use a dynamic model of the rm to ascertain both the value and the determinants of the tax bene ts of debt. A standard parameterization suggests that the value of the interest tax shields represents around 3% of rm value, and it varies considerably across industries. In addition, our results show that this component of the stock price behaves countercyclically over the business cycle. Finally, besides the interest rate on debt and the corporate income tax rate, we nd that the curvature of the production function is one of the most important determinants of the tax advantage of debt.	en_US
dc.rights	This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.	en_US
dc.title	On the Value and Determinants of the Interest Tax Shields	en_US
dc.type	Article	en_US
dc.contributor.department	Graduate School of Business & Public Policy (GSBPP)	en_US

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