American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
RETRACTED BY THE AUTHORS: Dividend Taxes and the Allocation of Capital
American Economic Review
vol. 112,
no. 9, September 2022
(pp. 2884–2920)
Dividend Taxes and the Allocation of Capital: Comment
Retraction of "Dividend Taxes and the Allocation of Capital"
Retraction of "Dividend Taxes and the Allocation of Capital"
Abstract
This paper investigates the 2013 threefold increase in the French dividend tax rate. Using administrative data covering the universe of firms from 2008 to 2017 and a quasi-experimental setting, we find that firms swiftly cut dividend payments and used this tax-induced increase in liquidity to invest more. Heterogeneity analyses show that firms with high demand and returns on capital responded most while no group of firms cut their investment. Our results reject models in which higher dividend taxes increase the cost of capital and show that the tax-induced increase in liquidity relaxes credit constraints, which can reduce capital misallocation.Citation
Boissel, Charles, and Adrien Matray. 2022. "RETRACTED BY THE AUTHORS: Dividend Taxes and the Allocation of Capital." American Economic Review, 112 (9): 2884–2920. DOI: 10.1257/aer.20210369Additional Materials
JEL Classification
- D22 Firm Behavior: Empirical Analysis
- G31 Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
- G35 Payout Policy
- H25 Business Taxes and Subsidies including sales and value-added (VAT)
- H32 Fiscal Policies and Behavior of Economic Agents: Firm