The study of finance and taxation is crucial for a nation’s development. As the backbone of any economy, finances and tax related matters are vital for the growth of the nation. This section provides information on insurance, banking, and the economy. It also provides details on various government acts, schemes, and regulations. This information can be used in evaluating government policies and programs, and preparing a budget. The section also offers advice on personal and business taxes.
The first essay in this dissertation uses a panel of corporate tax returns to examine the relationship between bank competition and financing of firms. It shows that more competitive banking markets use less outside debt and more inside debt and equity than less competitive markets. The authors also find that banks hold implicit equity stakes in borrowers when their customers pay off their loans. The findings are consistent with previous studies that suggest that market power in the financial sector makes banks more willing to lend money to borrowers who have delayed payoffs.
The second essay uses a panel dataset of U.S. corporate tax returns to examine the relationship between financial competition and financing of firms. The authors find that more competitive banking markets use less outside debt and more inside debt and equity. This result is consistent with other evidence that suggests that banks have implicit equity stakes in borrowers, which makes them more apt to lend money to those with delinquent payoffs. The last essay explores how economic conditions affect the level of risk in the financial system.
The impact of taxation on corporate financial behavior is a hotly debated issue. One recent study, conducted by Honohan and Yoder, found that the application of a generalized financial transactions tax would fail to raise a significant percentage of GDP. The evidence suggests that a broad financial transactions tax would not correct overtrading. In fact, it would increase risk in the financial system. The authors concluded that the implementation of a global financial transactions tax would be counterproductive.
The impact of taxation on the financial decisions of corporations is one of the main reasons for the ongoing global economic crisis. The government’s policies impact the performance of firms and cause the value of these companies to fall. This can lead to a rise in debt and taxation, and the economy to suffer. A diversified financial system will benefit from the increased demand for capital. But how does the tax system affect business? The answer will surprise you.
A global tax can be an effective way to reduce national tax rates and reduce sovereign debt burdens. It also helps to eliminate the incentives to substitute a financial asset or financial center. The taxation system has a major impact on the financial behavior of firms. The impact of a taxation on a firm’s capital structure and its profitability is very important to the long-term health of the firm. A well-designed plan can improve the profitability of the firm.
