We examine whether labor market frictions affect firms' tax aggressiveness. Exploiting the adoption of U.S. state-level Wrongful Discharge Laws as a quasi-exogenous shock to a firm's firing costs, we document a decline in tax aggressiveness for firms located in states that increase employment...

Using a comprehensive firm-level and a unique confidential loan-level combined dataset, we examine the credit reallocation effects of minimum wage hikes in China. We show that in response to a wage rise shock, firms, especially those that are labor-intensive, are less likely to obtain a loan....