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Firms' marginal tax rate was computed as the effective tax rate. There has been progress in terms of unambiguously identifying tax effects in terms of measuring tax rates with sophisticated simulation techniques (Graham 1996a, b) and in addressing the endogeneity of the effective corporate marginal tax rate (Graham, Lemmon & Schallheim 1998). This defers tax and may even save tax if the withdrawal is made in a year when the individual's marginal tax rate is lower. |
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