How does quasi-indexer ownership affect corporate tax planning?
By Shuping Chen, Ying Huang, Ningzhong Li, Terry Shevlin. Journal of Accounting & Economics, 2019
135 citations recorded by the source corpus.
We study whether, and more importantly, through what mechanisms, quasi-indexers affect portfolio firms’ tax planning by employing the discontinuity in quasi-indexer ownership around the Russell 1000/2000 index cutoff. Using a regression discontinuity design, we find that higher quasi-indexer ownership leads to greater tax saving. With respect to the mechanisms, we find that the greater tax saving is a result of a focus on improved overall firm performance, not a specific focus on improved tax planning. We further find that the documented tax saving effect is partially due to quasi-indexers’ influences on executive equity incentives, corporate governance, and information environment.
Subfields: Accounting
View Paper: https://www.semanticscholar.org/paper/b45ecd3286878a51f766fc35fa0c5f653005e092
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Citations in the corpus
- Institutional Investor Attention and Firm Disclosure (2020, background): “7 this non-observability, but none of these approaches is perfect, and different approaches can lead to different inferences (Chen et al. 2019).”