Abstract
This paper studies the regulation of the brand market conceptualised as the merger & acquisition(M&A) market. By introducing a brand market into an endogenous growth model in which an informational asymmetry exists between capital-producing borrowers and lenders, we show a brand market screens the borrowers at the expense of crowding out real investment. The optimal brand price trades off the screening effect and the crowding out effect. The social planner could levy a reimbursement tax to achieve the optimal brand price. Capital income tax may be allowed to subsidise the brand purchase to activate the brand market.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
