Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/95238
Authors: 
Keser, Claudia
Kimpel, Gerrit
Oestreicher, Andreas
Year of Publication: 
2014
Series/Report no.: 
Discussion Papers, Center for European Governance and Economic Development Research 199
Abstract: 
The objective of this paper is to look into the probability that, given the choice, corporate groups would opt for taxation on a consolidated basis. Consolidation would allow them to offset losses crossborder but remove the opportunity to exploit international tax-rate differentials between entities via transfer pricing. We present a laboratory experiment in which we investigate to what extent a corporation would be inclined to take up the consolidation option and how this would impact on the corporation´s location of investment and its transfer pricing activities involving locations outside the consolidated group. We use a 2-by-2 treatment design with two levels of tax-rate differential between two investment locations, and two different remuneration functions allowing the participants to act as owners or managers of a company.
Subjects: 
international company taxation
separate accounting
formula apportionment
transfer pricing
experimental economics
JEL: 
C91
H25
M41
Document Type: 
Working Paper

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