Differential Taxation and Firms' Financial Leverage: Evidence from the Introduction of a Flat Tax on Interest Income

Tax competition for the mobile factor capital has led to a trend in many countries to levy lower taxes on interest income, often introducing differential taxation between interest and business income. In this study, we analyze the effect of such differential taxation on the debt ratio of firms. We exploit a 2009 tax reform in Germany as a quasi-experiment, which introduced a flat final withholding tax and opened a gap of 18 percentage points between the tax rate on income from unincorporated businesses and the new lower tax rate on interest income. We apply a regression adjusted semi-parametric difference-in-difference matching strategy based on firm level panel data. In addition, we implement a more structural approach with a tax rate differential, taking into account its endogeneity by using instrumental variables. The results indicate that firms increase their leverage when the tax rate on interest income decreases, albeit to a small degree.Income taxation, capital taxation, financial structure, leverage, matching

Rare earth elements in Andaman Island surface water : geochemical tracers for the monsoon

The Asian summer monsoon affects the lives of billions of people. With the aim of identifying geochemical tracers for the monsoon related freshwater input from the major rivers draining into the Bay of Bengal and Andaman Sea we have taken surface seawater samples from various locations up and down the Andaman Islands during 2011. Importantly, in some locations samples have been taken in March, July and November, covering most of a seasonal cycle and different monsoon phases. Samples were collected from the side of small wooden boats or while swimming and were filtered within a few hours at 0.45 or 0.22 microns using the vacuum produced by a water jet or a hand operated peristaltic pump. Filtered and unfiltered samples were acidified to < pH 2 and analysed for Y and the REEs with an automated online preconcentration ICP-MS technique [1]. The local input of REEs from streams and sediment rich areas such as mangrove environments is clearly identified by middle REE enrichments in the shale normalised patterns of some samples. These middle REE bulges accompany large increases in dissolved REE concentrations at some locations, especially for the July samples obtained during the peak monsoon season with frequent storms. Y/Ho fractionation aslo occurs during the local input of dissolved REEs with affected samples having lower Y/Ho ratios. Conversly, some samples, in particular those taken after heavy rainfall in March, show strong REE scavenging accompanied by the prefferential removal of dissolved light REEs and higher Y/Ho ratios. The time series at a location away from local input sources shows remarkably similar REE patterns and concentraions in March and July. Then in October-November, following the peak in monsoon river discharge, the dissolved REE concentration increases by almost a factor of 2. The notable exception to this seasonal pattern is the Ce anomally which is around 0.3 in March and November but 0.6 in July, implying less oxidative removal of Ce(IV) during the peak summer monsoon rains. With the exception of elevated dissolved Ce concentrations, the North Pacific Deep Water normalised REE patterns are similar to those reported for offshore samples from the Bay of Bengal and Andaman Sea [2]. These seawater normalised patterns are distinctive having a middle REE enriched arc with similar light and heavy REE values suggesting the input from large rivers in the region is traceable using seawater REE chemistry. [1] Hathorne et al. (2012), Online preconcentration ICP-MS analysis of rare earth elements in seawater, Geochem. Geophys. Geosyst., 13, Q01020, doi:10.1029/2011GC003907. [2] Amakawa et al. (2000), Geochim. Cosmochim. Acta 64, 1715-1727

A citation-based map of concepts in invasion biology

Invasion biology has been quickly expanding in the last decades so that it is now metaphorically flooded with publications, concepts, and hypotheses. Among experts, there is no clear consensus about the relationships between invasion concepts, and almost no one seems to have a good overview of the literature anymore. Similar observations can be made for other research fields. Science needs new navigation tools so that researchers within and outside of a research field as well as science journalists, students, teachers, practitioners, policy-makers, and others interested in the field can more easily understand its key ideas. Such navigation tools could, for example, be maps of the major concepts and hypotheses of a research field. Applying a bibliometric method, we created such maps for invasion biology. We analysed research papers of the last two decades citing at least two of 35 common invasion hypotheses. Co-citation analysis yields four distinct clusters of hypotheses. These clusters can describe the main directions in invasion biology and explain basic driving forces behind biological invasions. The method we outline here for invasion biology can be easily applied for other research fields

Crumbling under Pressure

In order for an organism to maintain its form, it must be able to withstand physical perturbation, including the pull of gravity. A recent study in Nature from Porazinski and colleagues (2015) suggests that mechanisms promoting tissue tension are critical to resist the Earth’s downward pull

Entrepreneurial spillovers over space and time

Entrepreneurship is a local and dynamic phenomenon. We jointly investigate spatial spillovers and time persistence of regional new business formation. Using panel data from all 402 German counties for 1996-2011, we estimate dynamic spatial panel models of business creation in the high-tech and manufacturing industries. We consider regions of different sizes and systematically search for the most suitable spatial weighting matrices. We find substantial spatial spillovers as well as time persistence of start-up activity, especially in the high-tech industry. This indicates that entrepreneurship is deeply rooted in regions and underlines the importance of local entrepreneurship culture for new business formation

Evolution of YidC/Oxa1/Alb3 insertases: three independent gene duplications followed by functional specialization in bacteria, mitochondria and chloroplasts

Members of the YidC/Oxa1/Alb3 protein family facilitate the insertion, folding and assembly of proteins of the inner membranes of bacteria and mitochondria and the thylakoid membrane of plastids. All homologs share a conserved hydrophobic core region comprising five transmembrane domains. On the basis of phylogenetic analyses, six subgroups of the family can be distinguished which presumably arose from three independent gene duplications followed by functional specialization. During evolution of bacteria, mitochondria and chloroplasts, subgroup-specific regions were added to the core domain to facilitate the association with ribosomes or other components contributing to the substrate spectrum of YidC/Oxa1/Alb3 proteins

ENLIVE: An Efficient Nonlinear Method for Calibrationless and Robust Parallel Imaging

Robustness against data inconsistencies, imaging artifacts and acquisition speed are crucial factors limiting the possible range of applications for magnetic resonance imaging (MRI). Therefore, we report a novel calibrationless parallel imaging technique which simultaneously estimates coil profiles and image content in a relaxed forward model. Our method is robust against a wide class of data inconsistencies, minimizes imaging artifacts and is comparably fast combining important advantages of many conceptually different state-of-the-art parallel imaging approaches. Depending on the experimental setting, data can be undersampled well below the Nyquist limit. Here, even high acceleration factors yield excellent imaging results while being robust to noise and the occurrence of phase singularities in the image domain, as we show on different data. Moreover, our method successfully reconstructs acquisitions with insufficient field-of-view. We further compare our approach to ESPIRiT and SAKE using spin-echo and gradient echo MRI data from the human head and knee. In addition, we show its applicability to non-Cartesian imaging on radial FLASH cardiac MRI data. Using theoretical considerations, we show that ENLIVE can be related to a low-rank formulation of blind multi-channel deconvolution, explaining why it inherently promotes low-rank solutions.Comment: 17 pages, 10 figure

Preparing projected entangled pair states on a quantum computer

We present a quantum algorithm to prepare injective PEPS on a quantum computer, a class of open tensor networks representing quantum states. The run-time of our algorithm scales polynomially with the inverse of the minimum condition number of the PEPS projectors and, essentially, with the inverse of the spectral gap of the PEPS' parent Hamiltonian.Comment: 5 pages, 1 figure. To be published in Physical Review Letters. Removed heuristics, refined run-time boun