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Stochastic and Global Optimization

  • Gintautas Dzemyda
  • Vydūnas Šaltenis
  • Antanas Žilinskas

Part of the Nonconvex Optimization and Its Applications book series (NOIA, volume 59)

Table of contents

  1. Front Matter
    Pages i-xi
  2. V. I. Arkin, A. D. Slastnikov
    Pages 19-32
  3. I. D. L. Bogle, R. P. Byrne
    Pages 33-48
  4. James M. Calvin, Antanas Žilinskas
    Pages 49-63
  5. Gintautas Dzemyda
    Pages 65-91
  6. Domenico Famularo, Paolo Pugliese, Yaroslav D. Sergeyev
    Pages 93-109
  7. Karl Frauendorfer, Gido Haarbrücker
    Pages 111-127
  8. Eligius M. T. Hendrix, Pilar M. Ortigosa, Inmaculada Garcia
    Pages 129-145
  9. Birna P. Kristinsdottir, Zelda B. Zabinsky, Graham R. Wood
    Pages 147-174
  10. Vydūnas Šaltenis, Vytautas Tiešis
    Pages 209-219
  11. Back Matter
    Pages 234-236

About this book

Introduction

In the paper we propose a model of tax incentives optimization for inve- ment projects with a help of the mechanism of accelerated depreciation. Unlike the tax holidays which influence on effective income tax rate, accelerated - preciation affects on taxable income. In modern economic practice the state actively use for an attraction of - vestment into the creation of new enterprises such mechanisms as accelerated depreciation and tax holidays. The problem under our consideration is the following. Assume that the state (region) is interested in realization of a certain investment project, for ex- ple, the creation of a new enterprise. In order to attract a potential investor the state decides to use a mechanism of accelerated tax depreciation. The foll- ing question arise. What is a reasonable principle for choosing depreciation rate? From the state’s point of view the future investor’s behavior will be rat- nal. It means that while looking at economic environment the investor choose such a moment for investment which maximizes his expected net present value (NPV) from the given project. For this case both criteria and “investment rule” depend on proposed (by the state) depreciation policy. For the simplicity we will suppose that the purpose of the state for a given project is a maximi- tion of a discounted tax payments into the budget from the enterprise after its creation. Of course, these payments depend on the moment of investor’s entry and, therefore, on the depreciation policy established by the state.

Keywords

STATISTICA computer science discrete optimization efficiency global optimization mathematics optimization statistics

Editors and affiliations

  • Gintautas Dzemyda
    • 1
  • Vydūnas Šaltenis
    • 1
  • Antanas Žilinskas
    • 1
  1. 1.Institute of Mathematics and InformaticsVilniusLithuania

Bibliographic information

  • DOI https://doi.org/10.1007/b130735
  • Copyright Information Kluwer Academic Publishers 2002
  • Publisher Name Springer, Boston, MA
  • eBook Packages Springer Book Archive
  • Print ISBN 978-1-4020-0484-1
  • Online ISBN 978-0-306-47648-8
  • Series Print ISSN 1571-568X
  • Buy this book on publisher's site
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