TY - JOUR A1 - Bethmann, Inga A1 - Jacob, Martin A1 - Müller, Maximilian A. T1 - Tax loss carrybacks T2 - The Accounting Review N2 - Tax regimes treat losses and profits asymmetrically when profits are immediately taxed but losses are not immediately refunded. We find that treating losses less asymmetrically by granting refunds less restrictively increases loss firms' investment: A third of the refund is invested and the rest is held as cash or returned to shareholders. However, the investment response is driven primarily by firms prone to engage in risky overinvestment. Consistent with the risk of misallocation, we find a delayed exit of low-productivity loss firms receiving less restrictive refunds, indicating potential distortion of the competitive selection of firms. This distortion also negatively affects aggregate output and productivity. Our results suggest that stimulating loss firms' investment with refunds unconditional on their future prospects comes at the risk of misallocation. T3 - FAccT Center Working Paper Series - 21/2016 KW - Körperschaftssteuer KW - Corporate taxation KW - Steuerpolitik KW - Tax policy KW - Steuerlicher Verlustrücktrag KW - Tax loss carrybacks KW - Steuerliche Assymetrie KW - Tax asymmetry KW - Unternehmensinvestitionen KW - Corporate investments KW - Fehlleitung KW - Misallocation Y1 - 2018 UR - https://opus4.kobv.de/opus4-whu/frontdoor/index/index/docId/649 UR - https://ssrn.com/abstract=2711808 N1 - Publication status according to publisher: Received: November 29, 2016; Accepted: October 13, 2017 IS - Forthcoming ER -