From Mark Perry at Carpe Diem:
An expense is an expense: a minimum wage increase just gets taken out at the top of the income statement and a tax gets taken out … well … sometimes at the top of the income statement, and sometimes a few lines lower down.
The big implication of Modigliani-Miller for finance was the recognition that in many cases it didn’t matter how you financed a project.
That insight is used a lot by economists. We use it so much because lots of people outside of economics insist that, say, taking $12K away from a business one way is not as harmful as taking $12K away from them some other way. Yeah … right.