Corporate Tax Havens and Transparency
Research output: Contribution to journal › Editorial › Research › peer-review
Standard
Corporate Tax Havens and Transparency. / Bennedsen, Morten; Zeume, Stefan.
In: The Review of Financial Studies, Vol. 31, No. 4, 02.11.2017, p. 1221-1264.Research output: Contribution to journal › Editorial › Research › peer-review
Harvard
APA
Vancouver
Author
Bibtex
}
RIS
TY - JOUR
T1 - Corporate Tax Havens and Transparency
AU - Bennedsen, Morten
AU - Zeume, Stefan
PY - 2017/11/2
Y1 - 2017/11/2
N2 - We investigate shareholders’ reactions to the increased transparency of corporate tax haven activities in a hand-collected subsidiary data set covering 17,331 publicly listed firms in 52 countries. An increase in transparency through the staggered signing of bilateral tax information exchange agreements (TIEAs) between home countries and tax havens is associated with a 2.5% increase in the value of affected firms. The results are stronger for firms with more complex tax haven structures and weakly governed firms. Furthermore, firms that respond to TIEAs by haven hopping (i.e., they move subsidiaries from affected to nonaffected tax havens) do not experience an increase in firm value. These results are consistent with tax havens being used for expropriation activities that extend beyond pure tax-saving activities.
AB - We investigate shareholders’ reactions to the increased transparency of corporate tax haven activities in a hand-collected subsidiary data set covering 17,331 publicly listed firms in 52 countries. An increase in transparency through the staggered signing of bilateral tax information exchange agreements (TIEAs) between home countries and tax havens is associated with a 2.5% increase in the value of affected firms. The results are stronger for firms with more complex tax haven structures and weakly governed firms. Furthermore, firms that respond to TIEAs by haven hopping (i.e., they move subsidiaries from affected to nonaffected tax havens) do not experience an increase in firm value. These results are consistent with tax havens being used for expropriation activities that extend beyond pure tax-saving activities.
KW - Faculty of Social Sciences
U2 - 10.1093/rfs/hhx122
DO - 10.1093/rfs/hhx122
M3 - Editorial
VL - 31
SP - 1221
EP - 1264
JO - The Review of Financial Studies
JF - The Review of Financial Studies
SN - 0893-9454
IS - 4
ER -
ID: 196471629