| Abstract: | ABSTRACT In a recent JRS article Martinich and Hurter (1985)] we examined the production and spatial impact on a firm operating in an uncertain environment due to the imposition of a flat rate income tax. The impacts were shown to depend on the properties of the firm's production and preference functions. In this paper we develop further results for the case where the firm has a degree one homogeneous production function. It is shown that an income tax is technologically and spatially neutral for any risk-averse firm, without regard to any other properties of the preference function. Thus, we not only extend our earlier results for the degree one homogenous production function case but we also correct an error related to this case in the earlier paper. |
