Taxation of Risky Investment and Paradoxical Investor Behavior

Under uncertainty and irreversibility, real option-based models are widely accepted for assessing investment projects. So far the existing post-tax analyses do not provide a general analytical description of investor reactions towards profit tax rate changes. This paper sets out to fill part of the void. We implement a simple tax system and focus on risky capital market investment and an option to wait. Taxes affect risk-free and risky capital market investment asymmetrically and hence cause distortions. We analytically identify a set of neutral tax rates (tax regimes) that preserve the critical post-tax investment threshold in case of tax rate changes as well as general normal and paradoxical settings. Unlike for other tax paradoxa neither depreciation rules nor loss offset restrictions are responsible for the observed paradoxical reaction. Identifying normal and paradoxical tax regimes can be regarded as a first step to a generalized description of tax effects under uncertainty, both for individual project evaluation as well as for understanding tax effects on an aggregate level

Pharmacological approach to acute pancreatitis

The aim of the present review is to summarize the current knowledge regarding pharmacological prevention and treatment of acute pancreatitis (AP) based on experimental animal models and clinical trials. Somatostatin (SS) and octreotide inhibit the exocrine production of pancreatic enzymes and may be useful as prophylaxis against Post Endoscopic retrograde cholangiopancreatography Pancreatitis (PEP). The protease inhibitor Gabexate mesilate (GM) is used routinely as treatment to AP in some countries, but randomized clinical trials and a meta-analysis do not support this practice. Nitroglycerin (NGL) is a nitrogen oxide (NO) donor, which relaxes the sphincter of Oddi. Studies show conflicting results when applied prior to ERCP and a large multicenter randomized study is warranted. Steroids administered as prophylaxis against PEP has been validated without effect in several randomized trials. The non-steroidal anti-inflammatory drugs (NSAID) indomethacin and diclofenac have in randomized studies showed potential as prophylaxis against PEP. Interleukin 10 (IL-10) is a cytokine with anti-inflammatory properties but two trials testing IL-10 as prophylaxis to PEP have returned conflicting results. Antibodies against tumor necrosis factor-alpha (TNF-α) have a potential as rescue therapy but no clinical trials are currently being conducted. The antibiotics beta-lactams and quinolones reduce mortality when necrosis is present in pancreas and may also reduce incidence of infected necrosis. Evidence based pharmacological treatment of AP is limited and studies on the effect of potent anti-inflammatory drugs are warranted