@techreport{NBERw1941,
 title = "Investment Incentives and the Discounting of Depreciation Allowances",
 author = "Lawrence H. Summers",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "1941",
 year = "1988",
 month = "February",
 URL = "http://www.nber.org/papers/w1941",
 abstract = {This paper examines the discounting of depreciation allowances both
theoretically and empirically. Economic theory suggests that depreciation tax
shields should be discounted at the after tax riskless rates. However, a
survey of 200 major corporations indicates that they employ much higher
discount rates to depreciation allowances. Typical discount rates are in the
15 percent range. This finding suggests that "frontloaded" incentives like
the ITC provide maximal stimulus to corporate investment.},
}