This study examines the role of managers’ political campaign contributions in relation to their firms’ tax benefits. The study differs from extant public choice literature that has not examined the role of self-interested agents within the firm. Using a major tax law change, we find that...

"We document that simulated corporate marginal tax rates based on financial statement data (Shevlin 1990 and Graham 1996a) are highly correlated with simulated rates based on corporate tax return data. We provide algorithms that can be used to estimate the book or tax simulated rates when they...

Nonrecurring income taxes are transitory items that exclusively affect earnings through tax expense. We conduct the first in-depth examination of nonrecurring income taxes to determine whether they are primarily attributable to economic events or managerial opportunism. We find nonrecurring...

Implicit tax theory predicts that as capital moves to tax-favored investments, the expected pretax returns on those investments decrease. At the global level, this should create a positive relation between country-level tax rates and firm-level pretax returns. However, theory in income-shifting...