Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/89737
Authors: 
Krämer, Robert
Lipatov, Vilen
Year of Publication: 
2013
Series/Report no.: 
CESifo Working Paper 4436
Abstract: 
We analyze how interactions between corporate taxation and corporate governance affect shareholder capital. Using a model with strategic interaction between managers and outside shareholders, we hypothesize that, while an increase in the corporate tax rate decreases shareholder capital, an increase in tax enforcement attenuates this effect. The tax effect is less severe if firms have a more dispersed ownership structure. Empirically, using a large panel of European firm-level data, we find support for these hypotheses.
Subjects: 
corporate taxation
corporate governance
managerial diversion
shareholder capital
tax enforcement
JEL: 
G32
H25
H26
Document Type: 
Working Paper

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