Abstract
This chapter discusses the internal logic of an incentive system — the interrelationships of the incentives and the implications of having an incentive system at all. We first consider how and in what sense different forms of incentive may be equivalent to each other.
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The argument is set out rigorously in TPIEC 7.2 and 7.3. An algebraic formula is given on page 35 for expressing the present value of accelerated depreciation in terms of its investment-allowance equivalent.
The Dutch investment account may represent an innovation in this respect.
Among the most striking examples of this is the special depreciation allowances introduced in Germany as part of the measures for post-war reconstruction, the so-called Article 7 Group.
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© 1977 Springer Science+Business Media Dordrecht
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Bracewell-Milnes, B., Huiskamp, J.C.L. (1977). The logic of an incentive system. In: Investment Incentives. Springer, Dordrecht. https://doi.org/10.1007/978-94-017-4408-9_11
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DOI: https://doi.org/10.1007/978-94-017-4408-9_11
Publisher Name: Springer, Dordrecht
Print ISBN: 978-90-200-0499-1
Online ISBN: 978-94-017-4408-9
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