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Although culture is assumed to play a role in the development of tax systems internationally, its influence is not well understood. This study draws on the cultural frameworks by Hofstede (1980) and Gray (1988) to develop a theoretical model of the influence of culture on tax systems internationally. It also empirically tests hypotheses that relate Hofstede's (1980) individualism, uncertainty avoidance, power distance, and masculinity cultural dimensions to some key values of tax systems: equity, simplicity, neutrality, and visibility. Based on data from 43 countries, the regression results show that individualism is significantly related to all of the tax values, while power distance is significantly related to equity, neutrality, and visibility; and uncertainty avoidance is significantly related to simplicity, neutrality, and visibility. However, masculinity is not related to any of the tax values in the regression analysis. These findings provide support for the importance of culture in influencing tax systems.

ABSTRACTThis study examines the individual and joint effects of multinationality, tax havens, and intangible assets on transfer pricing aggressiveness. Based on a hand-collected sample of 286 publicly listed U.S. multinational firms over the 2006–2012 period (2,002 firm-year observations), the regression results indicate that multinationality, tax haven utilization, and intangible assets are significantly positively associated with transfer pricing aggressiveness. The regression results also show that firms magnify their international transfer pricing aggressiveness through the joint effects of intangible assets, multinationality, and tax havens. Overall, the empirical findings demonstrate that the utilization of tax havens and the level of intangible assets are economically important factors that assist firms in obtaining tax benefits through transfer pricing aggressiveness.Data Availability: All data are available from public sources identified in the paper.

AbstractUsing propensity score matching, we provide new evidence of a nonmonotonic relation between the number of anti‐takeover provisions (ATPs) a firm adopts, relative to peer‐matched firms, and takeover likelihood. Firms with either a relatively low or high number of ATPs are significantly less likely to be a takeover target. We argue that this outcome is a result of the expected benefits versus costs of targeting firms in the left and right tails of the peer‐matched ATP distribution. In particular, firms in the left tail with a relatively small number of ATPs tend to have high market valuations, indicative of management optimizing shareholder welfare and hence being less concerned about the threat of a takeover. Overall, our findings have important implications for both corporate and regulatory policy.