Made in the USA? : a study of firm responses to domestic production incentives
Name
928944565-MIT.pdf
Description
Full printable version
Size
3.12 MB
Format
Adobe PDF
Checksum (MD5)
451e1763893b48c838f6d03fdf6ca14f
Author(s)
Lester, Rebecca C
Advisor(s)
Michelle Hanlon.
Alternative Title
Study of firm responses to domestic production incentives
Date Issued
2015
Publisher
Massachusetts Institute of Technology
Abstract
How do U.S. companies respond to incentives intended to encourage domestic production and manufacturing? I study this question in the context of the Domestic Production Activities Deduction (DPAD), which was enacted in the American Jobs Creation Act of 2004 and is currently the third largest U.S. corporate tax expenditure. Specifically, I examine 1) whether and to what extent firms shift income to maximize the domestic manufacturing benefit, and 2) the extent that firms actually increase domestic investment and employment, measured using confidential data from the U.S. Bureau of Economic Analysis. While I find a positive effect of DPAD on domestic investment, I also find that DPAD firms shift income across time and (to a lesser extent) across borders to maximize the tax benefit. These results show that changes in firm reporting are an important and economically significant response that has not been studied previously in this context. Additionally, these findings inform the ongoing policy debate on the possible extension or repeal of this tax incentive.
Description
Thesis: Ph. D., Massachusetts Institute of Technology, Sloan School of Management, 2015.
Cataloged from PDF version of thesis.
Includes bibliographical references (pages 40-43).
Subjects
Sloan School of Management.
MIT Department
Sloan School of Management
Terms of Use
M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.
Persistent DSpace Link
