The role of regional institutional environment in the relationship between political participation and effective tax rates: evidence from Chinese listed private firms before the financial crisis

AbstractThe paper aims to find the relationship between corporate expenditures on R&D and tax burdens comparing German with French R&D incentives. We use the OLS method for the financial and patent cross-sectional data retrieved from the Amadeus database. The results confirm that firms with higher tax spread (the difference between the nominal and effective tax rates) spend less on R&D. These are in line with findings of a positive relationship between corporate R&D investment and tax burdens. Thus, firms that invest in R&D more pay higher taxes. However, they are less profitable as the return on R&D investment is visible only in the long run. German corporate expenditures on R&D are significantly sensitive to internal funds (proxied by cash flow) and depend on debt, contrary to French. The results indicate that the French firm's age (a phase of life cycle) has a significant impact on spending on R&D compared to German. Whereas in both countries, corporate expenditures on R&D are sensitive to the number of obtained patents. The capability of reducing the level of tax burdens below the nominal tax rate in the case of older German firms stimulates them to increase their R&D expenditures. However, German firms can decrease tax due to the use of R&D grants (revenues without taxation) in the absence of other tax incentives related to R&D.

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Institutional quality and the capital structure of microfinance institutions: the moderating role of board gender diversity

Journal of Institutional Economics ◽

10.1017/s1744137421000023 ◽

2021 ◽

pp. 1-21

Author(s):

Michael Adusei ◽

Beatrice Sarpong-Danquah

Keyword(s):

Capital Structure ◽

Institutional Environment ◽

Gender Diversity ◽

Institutional Quality ◽

Microfinance Institutions ◽

Female Representation ◽

Long Run ◽

Board Gender Diversity ◽

The Relationship

Abstract We test the effect of institutional quality on capital structure in the microfinance setting. In doing this, we rely on data from 532 microfinance institutions (MFIs) located in 73 countries dotted across the six microfinance regions in the world. We observe that institutional quality exhibits a robust negative and statistically significant relationship with capital structure in both the short and long run, implying that MFIs in countries with a better institutional environment are less likely to utilize more debt. Our moderation analysis furnishes us with evidence that the presence of women on the board of an MFI significantly moderates the relationship between institutional quality and its capital structure. We show that in the presence of more female representation on the boards of MFIs, the tendency of MFIs using less debt is higher.

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Institutional effect on born global firms in China: the role of Sun Tzu’s The Art of War strategies

Journal of Asia Business Studies ◽

10.1108/jabs-11-2014-0084 ◽

2016 ◽

Vol 10 (1) ◽

pp. 1-19 ◽

Cited By ~ 4

Author(s):

Man Zhang ◽

Qian Gao ◽

Jane V. Wheeler ◽

Jungsook Kwon

Keyword(s):

Emerging Markets ◽

Institutional Environment ◽

Critical Role ◽

Born Global ◽

Internationalization Process ◽

Content Type ◽

International Performance ◽

The Relationship ◽

Born Global Firms

Purpose – This paper aims to investigate the role of Sun Tzu’s significant strategies on the relationship between the institutional environment and international performance of Chinese born global firms, a type of small- and medium-sized enterprise (SME) characterized by the company’s limited resources and its early efforts to internationalize. Design/methodology/approach – The methodology is based on a multi-case analysis of interviews conducted with four chosen born global firms, coupled with public database and Web site searches. Through the use of qualitative methods, propositions were developed. Findings – This paper provides insights regarding how the institutional environment, both formal and informal, has a strong positive relationship with born global firm’s international performance. Moreover, Sun Tzu’s significant strategies play a critical role in the internationalization process of born global firms in emerging markets. Originality/value – Although existing studies discuss the application of Eastern philosophical strategies adopted by firms in emerging markets, to the best of our knowledge, this is one of the earliest studies which evaluates the moderation effect of Sun Tzu’s significant strategies on the relationship between institutional environment and business performance. The paper contributes to scholarly discourse on the influencing factors of born global firm’s internationalization process. It also has practical relevance to international entrepreneurs and SMEs from emerging markets.

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Do IRS Audits Deter Corporate Tax Avoidance?

The Accounting Review ◽

10.2308/accr-50187 ◽

2012 ◽

Vol 87 (5) ◽

pp. 1603-1639 ◽

Cited By ~ 166

Author(s):

Jeffrey L. Hoopes ◽

Devan Mescall ◽

Jeffrey A. Pittman

Keyword(s):

Tax Avoidance ◽

Tax Rates ◽

Coefficient Estimates ◽

Corporate Tax ◽

Effective Tax Rates ◽

Tax Enforcement ◽

Public Firms ◽

Large Samples ◽

Percentage Points

ABSTRACT We extend research on the determinants of corporate tax avoidance to include the role of Internal Revenue Service (IRS) monitoring. Our evidence from large samples implies that U.S. public firms undertake less aggressive tax positions when tax enforcement is stricter. Reflecting its first-order economic impact on firms, our coefficient estimates imply that raising the probability of an IRS audit from 19 percent (the 25th percentile in our data) to 37 percent (the 75th percentile) increases their cash effective tax rates, on average, by nearly two percentage points, which amounts to a 7 percent increase in cash effective tax rates. These results are robust to controlling for firm size and time, which determine our primary proxy for IRS enforcement, in different ways; specifying several alternative dependent and test variables; and confronting potential endogeneity with instrumental variables and panel data estimations, among other techniques. JEL Classifications: M40; G34; G32; H25.

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Political connections: a threat to auditor independence?

Journal of Accounting in Emerging Economies ◽

10.1108/jaee-03-2012-0013 ◽

2015 ◽

Vol 5 (2) ◽

pp. 222-246 ◽

Cited By ~ 6

Author(s):

Effiezal Aswadi Abdul Wahab ◽

Mazlina Mat Zain ◽

Rashidah Abdul Rahman

Keyword(s):

Design Methodology ◽

Institutional Environment ◽

Audit Fees ◽

Auditor Independence ◽

Political Connections ◽

Panel Regression ◽

Data Set ◽

Content Type ◽

The Relationship

Purpose – The purpose of this paper is to examine whether political connections further impair auditor independence by investigating the relationship between non-audit fees and audit fees and as to whether political connections moderate such relationship. Design/methodology/approach – This study employs panel regression analysis. The panel data set consists of 379 firm-year observations for three years from year 2001 to 2003. Findings – Based on 379 firm-year observations for the period of 2001-2003, grounded on two proxies of political connections namely politically connected firms and the proportion of Bumiputras directors, the authors find a positive and significant relationship between non-audit fees and audit fees, and the relationship becomes weaker, only for Bumiputra-dominated firms connected firms. Originality/value – This study contributes to the extant literature by examining the role of political connections in the context of auditor independence. In addition, this study is conducted in Malaysia, which provides a unique institutional environment with the existence of political connections that is built on ethnic grounds.

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The appeal of neo-fascism in times of crisis. The experience of CasaPound Italia

Fascism ◽

10.1163/22116257-00202007 ◽

2013 ◽

Vol 2 (2) ◽

pp. 234-258 ◽

Cited By ~ 7

Author(s):

Pietro Castelli Gattinara ◽

Caterina Froio ◽

Matteo Albanese

Keyword(s):

Financial Crisis ◽

Radical Right ◽

Consensus Building ◽

Right Wing ◽

Third Way ◽

The Relationship ◽

Market Capitalism ◽

Policy Proposals

The present works sets up to analyze the relationship between radical right activism and the unfolding of the financial crisis in Europe, investigating the extent to which the current economic circumstances have influenced right-wing movements’ political supply and repertoires of action. Using the case study of the Italian neo-fascist group CasaPound, and based on a mix of historiography and ethnographic methods, the present work systematically analyzes the ways in which the group tackles the economic crisis. We find that the crisis offers a whole new set of opportunities for the radical right to reconnect with its fascist legacy, and to develop and innovate crisis-related policy proposals and practices. The crisis shapes the groups’ self-understanding and its practices of identity building, both in terms of collective rediscovery of the fascist regime’s legislation, and in terms of promotion of the fascist model as a ‘third way’ alternative to market capitalism. Even more importantly, the financial crisis plays the role of the enemy against which the fascist identity is built, and enables neo-fascist movements to selectively reproduce their identity and ideology within its practices of protest, propaganda, and consensus building.

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Financial crisis and corporate governance: The role of internal audit in the Greek context

Corporate Board role duties and composition ◽

10.22495/cbv15i2art5 ◽

2019 ◽

Vol 15 (2) ◽

pp. 45-55

Author(s):

Andreas Koutoupis ◽

Michail Pazarskis ◽

Grigorios Lazos ◽

Ioannis Ploumpis

Keyword(s):

Corporate Governance ◽

Financial Crisis ◽

Audit Committee ◽

Stock Exchange ◽

Internal Audit ◽

Listed Companies ◽

Athens Stock Exchange ◽

Total Turnover ◽

The Relationship

In this paper, our purpose is to examine the relationship between the role of Internal Audit (IA), Corporate Governance (CG) and the Audit Committee (AC) in the recent financial crisis in Greece and to investigate the contribution of IA to CG structures as well as its possible, the IA’s role during the financial crisis in Greece. Moreover, little research has been conducted based on the relationship between corporate governance and internal audit during the financial crisis in case of Greece. For this reason, we conducted a survey, using questionnaires, which were sent to the listed companies of the Athens Stock Market. Out of a total of 192 listed companies on the Athens Stock Exchange, the relevant questionnaires were sent to 100 companies. Those companies were selected firstly based on their total turnover and secondly due to the availability of information from company websites such as employees’ numbers and Internal Audit Department Structures. Our conclusion was that Internal Audit adds value to the organization and it can also help the senior management towards the accomplishment of the organizational goals.

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Do Facebook and video games promote political participation among youth? Evidence from Singapore

JeDEM - eJournal of eDemocracy and Open Government ◽

10.29379/jedem.v3i1.49 ◽

2011 ◽

Vol 3 (1) ◽

pp. 70-79 ◽

Cited By ~ 7

Author(s):

Marko M Skoric ◽

Grace Kwan

Keyword(s):

Video Games ◽

Political Participation ◽

Political Engagement ◽

Democratic Society ◽

Video Gaming ◽

Traditional Media ◽

Online Participation ◽

Facebook Use ◽

The Relationship

The importance of cultivating political engagement among youth has been widely discussed and its value for a well-functioning democratic society reaffirmed by numerous scholars. This study seeks to understand the relationship between the use of emerging platforms for online sociability and entertainment and political participation among young Singaporeans. Specifically, we focus on the intensity of Facebook use and frequency of video gaming, as well as more specific civic activities taking place on these platforms. The findings indicate that the intensity of Facebook use is related to both online and traditional political participation, while civic gaming is associated with online participation only. There is also evidence linking membership in civic/political Facebook groups with increased online participation. Lastly, although the results suggest that online participation may be an important driver of traditional political participation, the role of traditional media, particularly newspapers, should not be easily dismissed.

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Political uncertainty and the choice of external audit: international evidence from private firms

International Journal of Managerial Finance ◽

10.1108/ijmf-07-2020-0384 ◽

2020 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Omar Farooq ◽

Harit Satt ◽

Basma El Fadel

Keyword(s):

Institutional Environment ◽

Financial Statements ◽

Private Firms ◽

Political Uncertainty ◽

External Audit ◽

High Exposure ◽

Content Type ◽

External Auditors ◽

The Impact

PurposeThis paper documents the impact of political uncertainty on the decision of private firms to use external auditors to verify their financial statements.Design/methodology/approachThe authors use the data from 141 countries and the pooled logistic regression to test our arguments. The data is provided by the World Bank's Enterprise Surveys and is collected during the period between 2006 and 2019.FindingsThe results show that firms with high exposure to political uncertainty are more likely to use external auditors to verify their financial statements. The results are robust across various sub-samples and hold when we use alternate proxy for political uncertainty. The results are also robust after controlling for potential endogeneity concerns. The authors also find that the effect of political uncertainty on the choice of external audit is more pronounced for firms that are headquartered in countries with weak institutional environment. The authors document significant role of democracy, rule of law and accountability in determining the relationship between political uncertainty and the choice of external audit.Originality/valueThe authors believe that theirs is one of the initial attempts (if not the first) to investigate the effect of political uncertainty on the choice of external audit among the private firms in developing countries.

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Impact of Microfinance on Poverty in the Context of Global Financial Crisis

Socio-Economic Development ◽

10.4018/978-1-5225-7311-1.ch067 ◽

2019 ◽

pp. 1317-1333

Author(s):

Arindam Laha

Keyword(s):

Regression Analysis ◽

Financial Crisis ◽

South Asia ◽

Global Financial Crisis ◽

Poor Households ◽

Head Count ◽

The Global Financial Crisis ◽

The Impact ◽

The Relationship

The microfinance programme in the South Asia region has proven to be resilient to the shocks of global financial crisis. In fact, cross country experiences in South Asia reveal little impact of the global financial crisis on the penetration of the microfinance programmes to poor households. To explore the impact of microfinance on poverty in the backdrop of global financial crisis, an attempt has been made in this present study to examine the relationship between MFI's gross portfolio per active borrower and the measures of poverty. Empirical evidences based on Pooled Regression Analysis suggest that gross portfolio per active borrower is negatively and significantly associated with the poverty head count ratio or poverty gap measure, which is consistent with the author's hypothesis that micro loans reduce poverty. The poverty alleviation role of microfinance in South Asian countries is not changing its dynamics even in post-crisis scenario.

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