2020年12月8日学术报告通知

发布时间:2020-12-04


内容提要:

Income taxes are a major expense for profitable corporations, oftentimes 25 percent or more of  pretax income. This study exploits a setting – the market for corporate control – to test competing  agency-based and risk-based explanations of corporate tax planning. Exploiting the staggered  enactment of M&A laws across countries that increased the threat of takeover as an exogenous  shock that allows a powerful difference-in-differences design, we find a significant reduction in  tax avoidance following the takeover law passageOur analysis suggests that reduced management  private benefits consumption (i.e., rent extraction), rather than managerial effort aversion or increased risk concerns associated with aggressive tax strategies, is the likely mechanism through  which takeover laws impact tax avoidance. Collectively, our findings extend the literature by  highlighting the role of the corporate control market in shaping cross-sectional variation in  corporate tax avoidance.