How does quasi-indexer ownership affect corporate tax planning?

• 成果类型: Article
• 署名作者: Chen, Shuping; Huang, Ying; Li, Ningzhong; Shevlin, Terry
• 署名单位: University of Texas System; University of Texas Austin; University of Texas System; University of Texas Dallas; University of California System; University of California Irvine
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2018.01.001
• 发表日期: 2019
• 关键词: INSTITUTIONAL OWNERSHIP; incentives; governance; avoidance

摘要

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.