frictions. We illustrate these results by studying one of the largest tax incentives for investment in recent history: China …A universal fact of firm-level data is that investment is lumpy: firms either replace a considerable fraction of their … existing capital (spike) or do not invest at all (inaction). This paper incorporates the lumpy nature of investment into the …

these results by studying China's 2009 VAT reform, which lowered the tax cost of investment and reduced partial …We incorporate the lumpy nature of firm-level investment into the study of how tax policy affects investment behavior …. We show that tax policies can directly impact the lumpiness of investment. Extensive-margin responses to tax policy are …

China reformed value-added tax (VAT) by removing investment from the tax base in northeastern provinces in 2004, which … investigates the impact of VAT reform on China firms' fixed asset investment, employment behavior, innovative activities, and …-level panel data of large and medium-sized manufacturing enterprises in China. We find that VAT reform significantly promotes …

incentive effects of such reforms on the SMEs’ investment decisions adopting simple present value model. Ceteris paribus tax …