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How Did Firms Adjust Their Tax-Deductible Activities in Response to the Economic Recovery Tax Act of 1981?

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  • Trezevant, Robert

Abstract

A study of debt policy and changes to deductible noninvestment activities firms made in response to ERTA (1981). Tradeoffs were made between activities that generate tax shields, interest expenses, pension expenses, and labor expenses.

Suggested Citation

  • Trezevant, Robert, 1994. "How Did Firms Adjust Their Tax-Deductible Activities in Response to the Economic Recovery Tax Act of 1981?," National Tax Journal, National Tax Association;National Tax Journal, vol. 47(2), pages 253-271, June.
  • Handle: RePEc:ntj:journl:v:47:y:1994:i:2:p:253-71
    DOI: 10.1086/NTJ41789067
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    References listed on IDEAS

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    1. Trezevant, Robert, 1992. "Debt Financing and Tax Status: Tests of the Substitution Effect and the Tax Exhaustion Hypothesis Using Firms' Responses to the Economic Recovery Tax Act of 1981," Journal of Finance, American Finance Association, vol. 47(4), pages 1557-1568, September.
    2. Harris, Milton & Raviv, Artur, 1991. "The Theory of Capital Structure," Journal of Finance, American Finance Association, vol. 46(1), pages 297-355, March.
    3. Leslie A. Nay, 1991. "The Determinants of Concession Bargaining in the Airline Industry," ILR Review, Cornell University, ILR School, vol. 44(2), pages 307-323, January.
    4. Thomas, Jacob K., 1988. "Corporate taxes and defined benefit pension plans," Journal of Accounting and Economics, Elsevier, vol. 10(3), pages 199-237, July.
    5. Thomas, Jacob K., 1989. "Why do firms terminate their overfunded pension plans?," Journal of Accounting and Economics, Elsevier, vol. 11(4), pages 361-398, November.
    6. MacKie-Mason, Jeffrey K, 1990. "Do Taxes Affect Corporate Financing Decisions?," Journal of Finance, American Finance Association, vol. 45(5), pages 1471-1493, December.
    7. Mitchell A. Petersen, 1992. "Pension Reversions and Worker-Stockholder Wealth Transfers," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(3), pages 1033-1056.
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    Cited by:

    1. Cloyd, C. Bryan & Limberg, Stephen T. & Robinson, John R., 1997. "The Impact of Federal Taxes on the Use of Debt by Closely Held Corporations," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(2), pages 261-277, June.
    2. Cloyd, C. Bryan & Limberg, Stephen T. & Robinson, John R., 1997. "The Impact of Federal Taxes on the Use of Debt by Closely Held Corporations," National Tax Journal, National Tax Association, vol. 50(2), pages 261-77, June.
    3. Calegari, Michael J., 2000. "The effect of tax accounting rules on capital structure and discretionary accruals," Journal of Accounting and Economics, Elsevier, vol. 30(1), pages 1-31, August.

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