Tax-savvy executives

• 成果类型: Article
• 署名作者: Kubick, Thomas R.; Li, Yijun; Robinson, John R.
• 署名单位: University of Nebraska System; University of Nebraska Lincoln; Erasmus University Rotterdam - Excl Erasmus MC; Erasmus University Rotterdam; Texas A&M University System; Texas A&M University College Station; Mays Business School
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-020-09543-y
• 发表日期: 2020
• 页码: 1301-1343
• 关键词: Financial constraints; Managerial ability; NETWORK TIES; corporate; firm; performance; incentives; management; Aggressiveness; succession

摘要

We investigate why firms include individuals with significant professional tax experience on their senior management team and the consequences associated with the presence of thesetax-savvyexecutives. We find that past performance, network connections, geographic location, and tax-rate level, relative to industry peers, are all significant determinants of having a tax-savvy executive on the senior management team. Using propensity-score matching, we find that effective tax rates decrease substantially after the addition of a tax-savvy executive to senior management and revert following the departure of such an executive. We connect the changes in effective tax rates to changes in the usage of foreign subsidiaries in low tax jurisdictions.