| Status | 進行中Working |
| Does Social Capital Accelerate the Adjustment Speed of Tax Burdens? | |
| Tang, F.; Lin, X.; Liu, M.; Yuen, C. Y. | |
| Abstract | We investigate whether the level of social capital in the region where a firm’s headquarters is located affects the decision of altering tax strategies to achieve the expected level of tax burdens over time. As a critical cultural factor, social capital, captured as altruistic norms and close interactions, motivates norm-complying behaviors and inhibits misbehaviors. Accordingly, social capital can reduce the frictions associated with tax planning adjustment and thus accelerate the speed of convergence toward optimal tax level. We provide consistent evidence that firms located in the areas of high social capital exhibit faster adjustment speed of tax burdens than those located in the areas of low social capital. Such effect of social capital is incremental over firm-specific attributes. In the time series, we further show that the impact of social capital is more pronounced during the financial crisis period. The results are robust after alleviating concern over endogeneity, taking religiosity into account, and using alternative measures of both tax burdens and social capital. Our findings shed more light on the role of external social environment in corporate tax decisions. |
| Keyword | Social Capital Tax Avoidance Optimal Taxation |
| Language | 英語English |
| The Source to Article | PB_Publication |
| PUB ID | 58069 |
| Document Type | Report |
| Collection | University of Macau |
| Recommended Citation GB/T 7714 | Tang, F.,Lin, X.,Liu, M.,et al. Does Social Capital Accelerate the Adjustment Speed of Tax Burdens?. |
| Files in This Item: | There are no files associated with this item. | |||||
Items in the repository are protected by copyright, with all rights reserved, unless otherwise indicated.
Edit Comment