...) and a variable component (a tax rate) and investigate how each type of tax expense affects the cost of equity capital. Unlike other fixed costs, the fixed tax component may be negative (a tax benefit). A lower fixed tax component always reduces cost of capital. The effect of a lower tax rate depends on the sign...

... to estimate the after-tax cost of debt ( Graham, Hanlon, Shevlin, and Shroff 2017 ), partially explaining our main results. tax avoidance cost of capital debt and equity financing Other studies focus on tax avoidance and cost of equity. Goh et al. (2016) rely on a cost of equity capital model...

... wisdom, warmth, and true friendship are profoundly missed by each of us. Editor's note: Accepted by Kenneth J. Klassen. July 2015 September 2016 2017 taxable income cost of capital performance variability, firm risk In this study we examine whether estimated...

.... However, prior research does not examine whether the Act increased corporate-level investment. Despite a reduction in their cost of capital and, thus, an incentive to increase capital investment, many firms increased their dividend payout in response to the 2003 Tax Act ( Chetty and Saez 2005 ; Brown...