Lee, Jangwook - In: KDI-journal of economic policy 46 (2024) 2, pp. 1-20
This study analyzes the impact of secondary tax liability borne by stockholders, an exception to the principle of … limited liability, on corporate investment. The paper constructs a model of a firm to examine the effect of this secondary tax … liability, finding that the violation of limited liability increases firms' expected bankruptcy costs, thereby reducing …