IDEAS home Printed from https://ideas.repec.org/a/oup/rfinst/v31y2018i4p1221-1264..html
   My bibliography  Save this article

Corporate Tax Havens and Transparency

Author

Listed:
  • Morten Bennedsen
  • Stefan Zeume

Abstract

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. Received March 4, 2017; editorial decision October 5, 2017 by Editor Andrew Karolyi. Authors have furnished an Internet Appendix, which is available on the Oxford University PressWeb site next to the link to the final published paper online.

Suggested Citation

  • Morten Bennedsen & Stefan Zeume, 2018. "Corporate Tax Havens and Transparency," The Review of Financial Studies, Society for Financial Studies, vol. 31(4), pages 1221-1264.
  • Handle: RePEc:oup:rfinst:v:31:y:2018:i:4:p:1221-1264.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/rfs/hhx122
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:rfinst:v:31:y:2018:i:4:p:1221-1264.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/sfsssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.