What determines the firm's choice of its mechanism of investment financing? How is the choice of the firm's financing mechanism at the micro level related to the economy's business cycle movements at the aggregate level? This paper develops a model of the credit market where the equilibrium...

We use micro data from the U.S. Internal Revenue Service to document how households’ taxliabilities vary with income, marital status and the number of dependents. We report facts onthe distributions of average and marginal taxes, properties of the joint distributions of taxespaid and income,...