Impact of BOI Incentives on Rate of Return, Factor Prices and Relative Factor Use: A Comparative Analysis of Incentives Under the Omnibus Investments Code of 1981 and the Investment Policy

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The host of incentives offered by the two most recent regulations on the rate of return is substantial. The relative impact of either legislation on most firms’ profitability is about the same except on pioneer expansion exporting enterprises that seem to be more favorable under the former incentive laws. These are the conclusions conveyed by this paper that looks into the various legislative incentives that have been passed since the start of the post-war era. How these incentives affect the industries’ rate of return, factor prices and relative factor use are also investigated.