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2006

Housing Law

Journal

Washington University in St. Louis

Articles 1 - 1 of 1

Full-Text Articles in Law

Tax Expenditures, Principal-Agent Problems, And Redundancy, David A. Weisbach Jan 2006

Tax Expenditures, Principal-Agent Problems, And Redundancy, David A. Weisbach

Washington University Law Review

This Article considers tax expenditures from two related perspectives. First, it analyzes how the incentives on Congress to use a tax expenditure change when principal-agent problems are considered. For example, it considers whether tax expenditures can reduce moral hazard or adverse selection problems created by delegations to expert agencies. Second, it considers the condition under which tax expenditures should be expected to be redundant with direct expenditures, as many are. The two perspectives—principal-agent problems and redundancy—are related because redundancy is often seen as a solution to the principal-agent problem. The Article concludes that both principal-agent concerns and redundancy ...