The Common Agricultural Policy (hereinafter – CAP) direct payment scheme has contributed to structural change in Lithuanian agriculture. In particular, it has influenced farmers' behaviour by making them reconsider their participation in agricultural production, leading to farm exits or...

I examine how corporate investment responds to the supply of private activity bonds (PAB), which are tax-exempt municipal bonds issued on behalf of private sector firms. Exploiting a change in the state-level cap for PABs as mandated by the 1986 Tax Reform Act, I compare the real effects of...