NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Long-Run Effects of the Accelerated Cost Recovery System

Don Fullerton, Yolanda K. Henderson

NBER Working Paper No. 828 (Also Reprint No. r0972)
Issued in December 1981
NBER Program(s):   PE

Much of the debate surrounding the enactment of President Reagan's tax plan was concerned with the short run effects of macroeconomic stimulation. Now that the Economic Recovery Tax Act of 1981 has become law, it is appropriate to look again at the long run effect of these tax cuts. This paper measures, for 37 different assets and for 18 different industries, the reduction in effective corporate tax rates that result from the acceleration of depreciation allowances and the expansion of the investment tax credit. It also uses a detailed dynamic general equilibrium model of the U.S. economy to simulate the effects of the new Accelerated Cost Recovery System (ACRS) on revenues, investment, long run growth, and capital allocation among industries. We find significant welfare gains from ACRS, but we find larger welfare gains from alternative plans that were not adopted.

download in pdf format
   (461 K)

download in djvu format
   (307 K)

email paper

This paper is available as PDF (461 K) or DjVu (307 K) (Download viewer) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w0828

Published: Fullerton, Don and Yolanda Kodrzycki Henderson. "Long-Run Effects of the Accelerated Cost Recovery System," Review of Economics and Statistics, Vol. L XVII, No. 3, August 1985, pp. 363-372.

Users who downloaded this paper also downloaded these:
Auerbach w0848 The New Economics of Accelerated Depreciation
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us