Corporate Social Responsibility and Profit Shifting
Iftekhar Hasan, Panagiotis I. Karavitis, Pantelis Kazakis, Woon Sau Leung
European Accounting Review,
forthcoming
Abstract
This paper examines the relation between corporate social responsibility (CSR) performance and tax–motivated income shifting. Using a profit–shifting measure estimated from multinational enterprises (MNEs) data, we find that parent firms with higher CSR scores shift significantly more profits to their low-tax foreign subsidiaries. Overall, our evidence suggests that MNEs engaging in CSR activities acquire legitimacy and moral capital that temper negative responses by stakeholders and thus have greater scope and chance to engage in unethical profit-shifting activities, consistent with the legitimacy theory.
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Banker Directors on Board and Corporate Tax Avoidance
Wenjie Ding, Iftekhar Hasan, Qian Song, Qingwei Wang
Journal of Empirical Finance,
December
2024
Abstract
We investigate how shareholder-debtholder conflict of interest affects the corporate tax avoidance using a unique setting of the affiliated and unaffiliated commercial bankers’ board representation. Consistent with the notion that board representation grants lenders’ access to private information that helps monitor and influence firms’ tax practice, we find that appointments of affiliated banker directors significantly reduce firms’ tax avoidance behavior, while appointing unaffiliated banker directors shows no such effect. The impact of affiliated banker directors on alleviating tax avoidance is stronger among firms with severer conflict of interest between shareholders and debtholders, specifically among firms with weaker corporate governance, higher financial leverage and higher CEO stock ownership.
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German Economy Ailing – Reform of the Debt Brake Is No Panacea
Timm Bönke, Oliver Holtemöller, Stefan Kooths, Torsten Schmidt, Timo Wollmershäuser
Wirtschaftsdienst,
No. 4,
2024
Abstract
Eine zähe Konjunkturschwäche, schwindende Wachstumskräfte und ein stark erhöhter Krankenstand führen zur Unterauslastung der Produktionskapazitäten. Außen- wie binnenwirtschaftlich gibt es mehr Gegen- als Rückenwind. Hoffnung geben die Wirksamkeit der höheren Lohnabschlüsse 2024 und 2025, die für einen Anstieg des privaten Konsums sorgen können und gesamtdeutsche Rekordwerte für die Einnahmenquote der öffentlichen Hand. Eine Reform der Schuldenbremse durch stufenweises regelgebundenes Aktivieren nach einer Notlage und ein Hebesatz auf die Einkommensteuer könnten die Konjunkturabhängigkeit der Bundes- und Länderfinanzen verringern. Die Inflation dürfte 2024 auf 2,6 % zurückgehen.
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The Effect of Foreign Institutional Ownership on Corporate Tax Avoidance: International Evidence
Iftekhar Hasan, Incheol Kim, Haimeng Teng, Qiang Wu
Journal of International Accounting, Auditing and Taxation,
March
2022
Abstract
We find that foreign institutional investors (FIIs) reduce their investee firms’ tax avoidance. We provide evidence that the effect is driven by the institutional distance between FIIs’ home countries/regions and host countries/regions. Specifically, we find that the effect is driven by the influence of FIIs from countries/regions with high-quality institutions (i.e., common law, high government effectiveness, and high regulatory quality) on investee firms located in countries/regions with low-quality institutions. Furthermore, we show that the effect is concentrated on FIIs with little experience in the investee countries/regions or FIIs with stronger monitoring incentives. Finally, we find that FIIs are more likely to vote against management if the firm has a higher level of tax avoidance.
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Do Digital Information Technologies Help Unemployed Job Seekers Find a Job? Evidence from the Broadband Internet Expansion in Germany
Nicole Gürtzgen, André Diegmann, Laura Pohlan, Gerard J. van den Berg
European Economic Review,
February
2021
Abstract
This paper studies effects of the introduction of a new digital mass medium on reemployment of unemployed job seekers. We combine data on broadband internet availability at the local level with German individual register data. We address endogeneity by exploiting technological peculiarities that affected the roll-out of broadband internet. Results show that broadband internet improves reemployment rates after the first months in unemployment for males. Complementary analyses with survey data suggest that internet access mainly changes male job seekers’ search behavior by increasing online search and the number of job applications.
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