Titolo
Production taxation and effciency when firms' organization is Endogenous
Periodico
Università degli Studi del Piemonte Orientale 'A. Avogadro' : Facoltà di Economia - Dipartimento di Scienze Economiche e Metodi Quantitativi "SEMEQ" - Quaderni
Anno: 2009 - Fascicolo: 19 - Pagina iniziale: 1 - Pagina finale: 22

We analyze the impact of production taxes on rms' organizational and production eciency when rms are fragmented, contracts are incomplete and managers choose between integration and outsourcing. We show that integration `protects' the rm from the `tax induced' output losses which arise under outsourcing due to managers' failure to coordinate. Production taxes also shift managers'preferences towards integration and induce them to switch from outsourcing to integration when the form is characterized by a high producer price. Our results also indicate that production taxes have a negative impact on welfare under outsourcing but not under integration, that a `tax induced organizational switch' from integration to outsourcing has a negative impact on welfare while this is not the case for the opposite switch from outsourcing to integration.



Testo completo: http://semeq.unipmn.it/files/Working%20Paper%20n.%2019.pdf

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