In China’s political selection system, officials capable of growing local economies are rewarded with promotions. Eager to demonstrate economic achievements, newly appointed local leaders may raise tax revenues to expand fiscal expenditures on infrastructure projects. Against this backdrop, we...

One institutional feature behind China's spectacular economic growth is its political selection system, which it uses to promote officials who are capable of growing local economies. Against this backdrop, we examine how political turnovers cyclically influence firms' tax avoidance behavior....

We study the role of internal control in tax avoidance by evaluating the efficacy of the COSO framework in tax risk management. First, we use a comprehensive COSO-based index in China that covers a firm's internal control over not only financial reporting, but also operations and compliance....

Exploiting a unique setting in China where internal controls are intended to manage risks, we investigate how internal controls shape the cash holding policies. Results show that firms with higher internal control quality (ICQ) are less likely to have abnormal cash holdings, either excess or...

We examine corporate philanthropic decisions in response to the local spread of COVID-19. From a strategic perspective, firms may proactively undertake philanthropic efforts to limit the spread of the pandemic and avoid a degraded business environment. From the perspective of non-trivial costs,...

In China's transitional economy, one of the major objectives of the government is to maintain social stability. We hypothesize that, through state ownership and appointment of executives, Chinese government officials can influence firms' labor-employment decisions by limiting layoffs when firms'...