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Desai, Mihir

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Desai

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Desai, Mihir

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2009 - 20102

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Author's Publications: search.filters.isAuthorOfPublication.675b4246-f853-4576-9b99-20a7d4b2a59a

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Now showing 1 - 2 of 2
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    Tax Incentives for Affordable Housing: The Low Income Housing Tax Credit
    (University of Chicago Press, 2010) Desai, Mihir; Dharmapala, Dhammika; Singhal, Monica
    The Low Income Housing Tax Credit (LIHTC) represents a novel tax expenditure program that employs “investable” tax credits to spur production of low-income rental housing. While it has grown into the largest source of new affordable housing in the U.S. and its structure is now being replicated in other programs, the LIHTC has also drawn skepticism and calls for its repeal. We provide estimates of tax expenditures under this program and discuss pricing, efficiency, and distributional effects of the program. We also consider the impacts of the recent financial crisis on the LIHTC program and explore implications of resulting policy changes and proposals.
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    Multinational Firms, FDI Flows and Imperfect Capital Markets
    (MIT Press, 2009) Antras, Pol; Desai, Mihir; Foley, C
    This paper examines how costly financial contracting and weak investor protection influence the cross-border operational, financing and investment decisions of firms. We develop a model in which product developers can play a useful role in monitoring the deployment of their technology abroad. The analysis demonstrates that when firms want to exploit technologies abroad, multinational firm (MNC) activity and foreign direct investment (FDI) flows arise endogenously when monitoring is nonverifiable and financial frictions exist. The mechanism generating MNC activity is not the risk of technological expropriation by local partners but the demands of external funders who require MNC participation to ensure value maximization by local entrepreneurs. The model demonstrates that weak investor protections limit the scale of multinational firm activity, increase the reliance on FDI flows and alter the decision to deploy technology through FDI as opposed to arm's length technology transfers. Several distinctive predictions for the impact of weak investor protection on MNC activity and FDI flows are tested and confirmed using firm-level data.