Can Tax Rate Increases Foster Investment under Entry and Exit Flexibility? - Insights from an Economic Experiment

It is well-known that taxes affect risky investment decisions. Analytical studies indicate that tax rate increases (decreases) can foster (hinder) investment if there is flexibility, in particular when an exit option is available. We design an experiment based on an analytical model with binomial random walk and entry and exit flexibility. Contrasting the underlying model, we find accelerated investment, which is often considered as an increased willingness to invest, on tax rate increases to be independent of the existence of an exit option. However, we observe this investor reaction only for a tax increase, not for a tax decrease. This behavior is driven possibly by tax salience and the mechanisms known from the theory of irreversible choice under uncertainty. Our empirical evidence suggests that the at-first-sight unexpected tax reform effects are more common than is predicted by the theoretical literature. Policy makers should therefore carefully consider the behavioral aspects when anticipating taxpayer reactions. (authors' abstract)Series: WU International Taxation Research Paper Serie

Extending the baseline of tropical dry forest loss in Ghana (1984–2015) reveals drivers of major deforestation inside a protected area

Tropical dry forests experience the highest deforestation rates on Earth, with major implications for the biodiversity of these ecosystems, as well as for its human occupants. Global remote sensing based forest cover data (2000 − 2012) point to the rapid loss of tropical dry forest in South America and Africa, also, if not foremost, inside formally protected areas. Here, we significantly extend the baseline of tropical dry forest loss inside a protected area in Ghana using a generalizable change detection technique. The forest cover change detection is based on the normalized difference vegetation index (NDVI) derived from historical Landsat data (1984–2015). Field measurements were carried out in dry semi-deciduous forest and in the adjacent savanna and woodland. Estimates of the canopy area index and above ground woody biomass were related to NDVI derived from Landsat 8 data. The change detection indicated significant NDVI decrease in a large area initially covered by tropical dry forest, associated with deforestation. The peak in deforestation was found to have occurred between 1990 and 2002, hereafter, the conservation status of the area was improved. A combination of remote sensing data corroborated by secondary data sources provides evidence for the almost complete clearance of a tropical dry forest inside a strictly protected area, attributable to logging and land clearing for arable farming. The NDVI change detection also revealed NDVI increase in the adjacent woodlands from 2002 to 2015, demonstrating woody encroachment. Historical fire data from the MODIS burned area product indicate that the deforested area experienced a high frequency of anthropogenic burning since 2004, which may have caused further degradation and largely prevents forest regeneration. The results show the ongoing destruction of tropical ecosystems even within ostensibly protected areas and ask for the revision of protection and management strategies of such areas

Search for dark matter produced in association with bottom or top quarks in √s = 13 TeV pp collisions with the ATLAS detector

A search for weakly interacting massive particle dark matter produced in association with bottom or top quarks is presented. Final states containing third-generation quarks and miss- ing transverse momentum are considered. The analysis uses 36.1 fb−1 of proton–proton collision data recorded by the ATLAS experiment at √s = 13 TeV in 2015 and 2016. No significant excess of events above the estimated backgrounds is observed. The results are in- terpreted in the framework of simplified models of spin-0 dark-matter mediators. For colour- neutral spin-0 mediators produced in association with top quarks and decaying into a pair of dark-matter particles, mediator masses below 50 GeV are excluded assuming a dark-matter candidate mass of 1 GeV and unitary couplings. For scalar and pseudoscalar mediators produced in association with bottom quarks, the search sets limits on the production cross- section of 300 times the predicted rate for mediators with masses between 10 and 50 GeV and assuming a dark-matter mass of 1 GeV and unitary coupling. Constraints on colour- charged scalar simplified models are also presented. Assuming a dark-matter particle mass of 35 GeV, mediator particles with mass below 1.1 TeV are excluded for couplings yielding a dark-matter relic density consistent with measurements