This paper examines the effect of tax incentives in the form of bonus depreciation on the quality of investment. Using the expiration of tax incentives via bonus depreciation in East Germany and a representative panel of West German establishments, we show that bonus depreciation significantly...

This paper reviews the literature and evidence of tax incentives offered by developing countries to attract foreign investment. Also reviews the consequences of the implementation of these measures, such as harmful tax competition, erosion of tax bases and many other issues arising from these...