This paper deals with the effects of tax rate uncertaity on risk-neutral and risk-averse investment behavior. We … analyse effects of stochastic tax rates on both real and financial investment. It emerges that under risk neutrality as well … as under risk aversion, increased tax rate uncertainty has an ambiguous impact on investment behavior, depending on the …

strength of reactions to estimates that reveal bad news. In the second experiment, I find that investment horizon moderates …-based differences in sensitivity to uncertainty. Results suggest that a short investment horizon causes investors to focus on more …