Tax Cuts or Fiscal Spending Increases:A Comparison of Policy Effect under the Difference of Leading Factors on Enterprise Investment
Since 2016,in order to deal with economic downturn risks and boost corporate investment confidence,the policies of cutting taxes and fees have become an important part of fiscal policy.Decision-making departments hope to help enterprises through"cost reduction",but the macroeconomic data show that the growth rate of fixed asset investment,especially private investment,has continued to decline during this period,and enterprise investment has been sluggish.In view of this,this paper focuses on how to effectively promote enterprise investment,and analyzes the effect difference of fiscal policy tools under different leading factors of enterprise investment.According to the neoclassical investment model proposed by Jorgenson(1963),the factors that determine enterprise investment can be divided into two categories:consumer demand factors and cost factors.After distinguishing the two leading factors that affect enterprise investment,this paper empirically examines the effects of consumption demand and cost factors on enterprise investment in different economic periods by using the macro quarterly data from 2002 to 2023 and using the local projection(LP)method.Then,based on the new Keynesian model constructed by Nolan and Thoenissen(2008),this paper constructs DSGE models with different investment decision mechanisms to analyze the impact of differences in leading factors of enterprise investment on the effects of different types of fiscal policy instruments.In addition,this paper also focuses on the difference in the effect of the two types of leading factors on policy instruments when product supply and consumption demand are not clear.The main results of this paper are as follows.First,in the period of economic contraction,enterprise investment is more driven by consumption demand.In the period of economic expansion,the cost factor has a greater incentive effect on enterprise investment.Second,when consumer demand dominates corporate investment,the effect of fiscal increase on"stable investment,employment and growth"is better than that of tax reduction.Whether the market clears or not will affect the positive effect of increased spending and weaken its advantage over tax cuts.The contributions of this paper are as follows.First,the effect difference of different fiscal policies is analyzed by focusing on the difference of leading factors for enterprise investment.Second,by describing the two types of enterprise investment decision mechanism,this paper introduces the two leading factors affecting enterprise investment into the DSGE framework,compares the difference in the effectiveness of fiscal policies under different leading factors for enterprise investment,and provides theoretical framework reference for subsequent relevant research.Third,in view of the current reality of oversupply and imbalance of supply and demand structure in China's economy,this paper discusses different scenarios such as inventory in the aforementioned DSGE model,and builds a scenario of product supply and consumption demand remaining unclear,so as to make up for the insufficient application of the DSGE model in China.
enterprise investmentcutting taxes and feesincreasing government spendingeffectiveness of fiscal policy
NETL
NSTL
万方数据
维普
