Changes in the Model of Financing Capital Expenditures of Nonfinancial Corporations in the US after the Tax Reform of Donald Trump

Student: Mednikova Polina

Faculty: Faculty of World Economy and International Affairs

Educational Programme: World Economy (Bachelor)

Year of Graduation: 2021

Creating an effective tax policy is often considered to be one of the most important factors in stimulating corporate capital expenditures through decreasing the cost of financing. The latest resonant and controversial case of altering tax legislation in US history is the Tax Cuts and Jobs Act of 2017 signed into law by President Donald Trump. Now, three years after the law was passed, the question about the effectiveness of the tax reform remains. The purpose of this research is to analyze the changes in the model of financing capital expenditures of nonfinancial corporations in the US after the enactment of the Tax Cuts and Jobs Act of 2017. In the following research regression analysis will be used in order to test the hypothesis of correlation between corporate income tax rate and capital expenditures.

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