fdi and taxation a meta study despite the continuing political interest in the usefulness of tax competition and tax coordination as well as the wealth of theoretical analyses it still remains open whether or when tax competition is harmful moreover the influence of tax differentials on multinationals decisions is still insufficiently analyzed thus economists have increasingly resorted to empirical analysis in order to gain insights on the elasticity of fdi with respect to company taxation as a result the empirical literature on taxation and international capital flows has grown to a similar abundance during the last 25 years as the respective theoretical literature its heterogeneity leads to a rising need for concise reviews on the existing empirical evidence in this paper we extend former meta analyses on fdi and taxation in three ways first we add the most recent publications unconsidered in meta analyses up to date second we apply a different methodology by using a broad set of meta regression estimators and explicitly discuss which one is most suitable for application to our meta data third we address some important issues in research on fdi and taxation to the clarification of which meta analysis can make valuable contributions these issues are mainly the influence of variables which might moderate effects of tax differentials e g public spending the implications of using aggregate fdi data as opposed to firm level information on measured tax effects the implications of bilateral effective tax rates and the possible presence of publication bias in primary research

bank control owner control or organizational dynamics who controls the large modern corporation there has been a long standing debate over who controls the large american corporation the results presented here indicate that existing power relations within the firm the conception of control that dominates the firm s actions and the actions of competitors account for the economic actions undertaken by large firms while the differences in manager or owner or bank control and the presence of bank interlocks do not a sociology of markets is therefore more likely to account for the courses of actions of large firms by considering these relations rather than focusing on the construction of interests by bankers owners or board interlocks

global microstructures the virtual societies of financial markets using participant observation data interviews and trading transcripts drawn from interbank currency trading in global investment banks this article examines regular patterns of integration that characterize the global social system embedded in economic transactions to interpret these patterns which are global in scope but microsocial in character this article uses the term global microstructures features of the interaction order loosely defined have become constitutive of and implanted in processes that have global breadth this study draws on schutz in the development of the concept of temporal coordination as the basis for the level of intersubjectivity discerned in global markets this article contributes to economic sociology through the analysis of cambist i e trading markets which are distinguished from producer markets and by positing a form of market coordination that supplements relational or network forms of coordination

misperceiving the beliefs of others how pluralistic ignorance contributes to the persistence of positive security analyst reactions to the adoption of stock repurchase plans we consider how a social psychological bias referred to as pluralistic ignorance occurs among security analysts and how this bias may lead to behavioral conformity and isomorphism in analysts reactions to the adoption of a particular organizational policy namely stock repurchase plans our theory suggests why 1 there may be a systematic tendency for analysts to underestimate the extent to which other analysts share their reservations about repurchase plans i e reservations about whether plans reflect well on the performance prospects of adopting firms such that 2 analysts conform to other analysts and issue more positive earnings forecasts and stock recommendations in response to the adoption of repurchase plans despite having private reservations about whether the plans reflect well on adopting firms we also contend that analysts are less likely to underestimate the extent to which others share their reservations about repurchase plans to the extent that they have frequent communication ties to other analysts whereas prior neoinstitutional research on conformity and isomorphism has primarily adopted a cognitive perspective in which actors conform to the behavior of others based on their understandings of a particular policy or practice i e they take the value of the policy for granted or infer the value of the policy from others prior decisions we develop a social psychological perspective on isomorphism wherein actors imitate others based on their biased perceptions of others beliefs about the policy we also extend perspectives on institutional persistence by explaining why constituents may continue to publicly endorse a policy despite having private reservations about the policy s efficiency benefits

the conditional nature of embeddedness a study of borrowing by large u s firms 1973 1994 economic and organizational sociologists have increasingly demonstrated that the actions of individuals and firms are affected by the social networks within which they are embedded in recent years scholars have begun to recognize that the effects of these social networks may vary across populations or types of relations this article examines the extent to which the effects of interfirm networks on the behavior of firms are historically contingent focusing on the level of debt financing among approximately 140 large u s corporations over a 22 year period the authors show that the extent to which the firms use of debt was influenced by those with which they were tied through director interlocks declined over time the authors argue that this decline in the network effect reflected a shift in the institutional environment within which the firms operated and that it was driven by three processes the professionalization of the finance function within the firm the internalization of financial decision

the effect of adoption of long term performance plans on stock prices and accounting numbers long term performance plans are theoretically adopted to better align the interests of the managers and stockholders by redirecting managerial decision making toward the longterm performance of the corporation this study reports significant positive excess returns around the announcement of performance plan adoption which is consistent with the view that such plans would reduce the agency problem in addition this study finds an association between the adoption of long term performance plans and subsequent growth in profitability suggesting that long term performance plans may have been successful in motivating an enhancement in the accounting measures of profitability used to reward managers under the plan finally the excess returns around the announcement of performance plan adoption are found to be positively correlated with subsequent change in growth of earnings per share the most commonly used accounting performance measure

here a chief there a chief the rise of the cfo in the american firm this article examines the rise of the chief financial officer cfo position among american firms during the period 1963 2000 building on event history models of cfo adoptions among a sample of some 400 large corporations this analysis documents two stages in the diffusion of the cfo model that occurred prior to its ultimate embodiment of the shareholder value ideal the cfo function originated as part of the conglomerate ideal to handle the funding of diversifying acquisitions in response to an ambiguous regulatory change in accounting rules in 1979 which threatened to reduce reported earnings further at a time when corporate earnings already were under great strain corporate leaders and finance professionals reconstructed the cfo as a solution the cfo s popularity quickly surged as a result and the role kept expanding in the following years to focus on managing shareholders and stock prices

the value of corporate philanthropy during times of crisis the sensegiving effect of employee involvement recent research suggests that philanthropy s value to the firm is largely mediated by contextual factors such as managers assumed motives for charity our article extends this contingency perspective using a sensegiving lens by which external actors interpretations of organizational actions may be influenced by the way in which the organization communicates about those actions we consider how sensegiving features in philanthropy related press releases affect whether investors value those donation decisions for the empirical investigation in this study we analyze abnormal returns to announcements by u s fortune 500 firms documenting their donations to hurricane katrina disaster relief in 2005 we expect that in general donation decisions would be controversial given the uncertainty surrounding the hurricane s economic effects at the time however we also propose that announcements emphasizing employee involvement in the donation send investors positive signals about the firm s ability to bounce back from the disaster s adverse effects we find empirical support for the proposed hypotheses and discuss the implications for theory and practice

when the market misleads stock prices firm behavior and industry evolution this paper augments learning and institutional theories of firm behavior with an explicit focus on the idiosyncratic characteristics of learning from financial markets various streams of literature implicitly assume that financial markets influence firm strategies yet the specifics of these interactions are not well specified motivated by a case study of the retail brokerage industry this study proposes three particular characteristics of learning from financial markets first there is vicarious learning from outcomes e g stock valuations yet this has characteristics that are more similar to institutional forms of mimetic isomorphism second the forward looking and complex nature of financial valuations incites a paradoxically simplified type of crude heuristic learning third there is a mutual and simultaneous learning process in that firms learn from financial markets which in turn are themselves in a process of social construction this combination of special characteristics suggests a number of learning pathologies that center around an increasing likelihood compared with other types of learning and adaptation of falling prey to misleading signals a computer simulation based on a model in which cournot duopolists play a multistage game involving investment and cost reduction explores the implications of these characteristics and pathologies in a systematic way

national institutional differences and cross border university industry knowledge transfer abstract does inter national institutional difference hamper technology transfer from the foreign university to the business enterprises a multinational study on institutions suggests that some elements of institutions of nations positively influence international technology transfer some other elements of institutions negatively influence the international technology transfer and yet some other elements of institutions of nations have no influence on the international technology transfer the empirical analysis on six institutional dimensions reveals variegated results i religious distance has a positive effect on international technology transfer when listed companies are controlled ii social distance has a positive effect when listed firms are not controlled iii education distance has a positive effect when listed companies are not controlled iv political distance has no effect on international technology transfer and vi industrial distance has negative effect on international technology transfer however hofstede s measures on national cultural dimensions show no significant effects the non significant results could be due to the measurement of national cultures characteristics of the biopharmaceutical industry or due to changes in the patterns of national cultures over time

cross border acquisitions the uk experience this paper tests a composite empirical model of cross border acquisitions involving uk firms between 1987 1995 using panel data analysis the empirical model includes capital market variables and regulatory variables derived from the existing literature the results show that models that explain cross border acquisitions through capital market imperfections are not significant cross border activity has a strong relationship with the level of the uk stock market suggesting that crossborder acquisitions are in some part an extension of domestic activity corporate tax differentials also have significant impact on activity

family firm governance strategic conformity and performance institutional vs strategic perspectives a fundamental schism divides the family firm and strategy literatures on the one hand and the institutional literature on the other regarding both the situational prevalence and the utility of conforming behavior the first two schools respectively view strategic differentiation as especially common among family firms and an important source of competitive advantage by contrast the reasoning of institutionalists would suggest that family firms will be subject to unusually powerful motivations to conform in part because of their pursuit of socioemotional wealth objectives unfortunately the relationships between conformity and family firm governance and in fact governance in general have not been amply studied this analysis of fortune 1000 firms finds considerable support for the institutional perspective family involvement is related to greater not lesser conformity in many aspects of strategy although strategic conformity related to superior returns on assets it did not enhance firm market valuations

revisiting supplier compliance with mnc codes of conduct recoupling policy and practice at chinese toy suppliers does private regulation of workers rights in global value chains improve working conditions on the factory floor drawing on one of the first systematic longitudinal studies of supplier compliance with multinational corporation mnc codes of conduct this paper finds in contrast to previous research substantial improvements over time while in 2004 the four examined chinese toy suppliers violated most of the evaluated code of conduct criteria and consciously decoupled the code of conduct policy from actual practices by 2009 they had recoupled policy and practice and complied with nearly all examined criteria except working hours the paper contributes to the private regulation literature by challenging previous research claims identifying factors that could make private regulation effective and outlining a research method for empirically studying the effects of codes of conduct over time the paper also contributes to new institutional theory by discussing how recoupling could be influenced by two factors not identified in previous research i trusting relationships between the organization and the stakeholder exerting pressure and ii factors unrelated to main external pressures leading to accidental recoupling

personal versus market logics of control a historically contingent theory of the risk of acquisition this paper develops and tests a theory of the historical contingency of the risk of acquisition using data from the higher education publishing market from 1958 1990 interviews and historical analyses are combined to identify two forms of capitalism personal and market and in particular to publishing to identify the institutional logics identified with each form of capitalism an editorial and a market logic hazard rate models are used to test for differences in the effects of these two logics on the organization and market determinants of acquisition publishers with relational network forms of organization in production and distribution were at a higher risk of acquisition in the market period but not in the editorial period competition in the product market increased the risk of acquisition in the market period but not the editorial period the covariates explaining the risk of acquisition change as a consequence of the evolution of capitalism and as a result of a firm s strategic and structural conformity with the institutional logic of the prevailing form of capitalism

framing controversial actions regulatory focus source credibility and stock market reaction to poison pill adoption we contribute to the research on organizational accounts by examining the role of different framing languages and the credibility of the frame articulator on justifying controversial organizational actions drawing on regulatory focus theory and the literature on source credibility we develop novel arguments as to how a gains versus nonlosses framing and the perceived credibility of the speaker influence stakeholder responses as well as how the effectiveness of these aspects is influenced by context we test our arguments using data on the framing of the adoption of poison pills by u s firms between 1983 and 2008 using content analysis and an event study we find that a gains framing aligned with the dominant institutional logic leads to a positive stock market reaction while statements emanating from speakers with potentially self serving interests negatively affect the stock market reaction our findings further show that the effectiveness of framing and source credibility are dependent on contextual attributes such as speaker visibility prior performance and practice prevalence

organizational susceptibility to institutional complexity critical events driving the adoption and implementation of the ethics and compliance officer position the institutional environment is complex this complexity is characterized by forces that ebb and flow in wavelike patterns as societal expectations evolve with attention coalescing around specific events and then dissipating some of these critical events are broad and affect many firms whereas others are narrow and affect individual firms in either case when they occur these events elevate organizational susceptibility to societal demands but encourage different kinds of behavior in response this study seeks to model this complexity in an area of growing interest for organization scholars business ethics in particular i examine how firms respond to shifting societal pressures for greater ethical behavior by adopting and implementing the ethics and compliance officer position from 1990 to 2008 results demonstrate that although firms decide when to adopt in response to broad fieldwide critical events it is narrower firm specific critical events that determine resource commitments in implementation

the rationale behind interfirm tender offers information or synergy this paper investigates the rationale behind interlirm tender offers by examining the returns realized by the stockholders of lirms that were the targets of unsuccessful tender offers and lirms that have made unsuccessful offers our results suggest that the permanent positive revaluation of the unsuccessful target shares documented by dodd and ruback 1977 and bradley 1980 is due primarily to the emergence of and or the anticipation of another bid that would ultimately result in the transfer of control of the target resources we also find that the rejection of a tender offer has differential effects on the share prices of the unsuccessful bidding firms depending upon whether the tender offer process results in a change in the control of target resources on the basis of these results we conclude that acquisitions via tender offers are attempts by bidding firms to exploit potential synergies not simply superior information regarding the true value of the target resources

on corporate governance a study of proxy contests abstract this paper examines a sample of firms experiencing proxy contests for seats on their board of directors dissident shareholders usually fail to obtain a majority of board seats nevertheless they capture some seats via mechanisms such as cumulative voting in over half of the sample contests regardless of proxy contest outcome positive and statistically significant share price performance is associated with the contest that finding is predicted by the standard economic analysis of proxy contests in which the challenges benefit shareholders by improving corporate performance the finding runs counter to the claim of berle 1962 that the economists view of proxy contests is a wholly imaginary picture a portion of the positive share price changes taking place in the early stages of some proxy contests is not permanent however and as suggested by manne 1962 is at least partially attributable to temporary increases in the market value of the vote attached to corporate shares

assessing the relationship between economic and ecological performance distinguishing system levels and the role of innovation in this article we critically discuss the different perspectives that are currently in use for assessing the relationship between ecological and economic performance based on a review of the literature we propose that research up till now has made use of four distinct system boundaries the firm markets production and consumption systems and economic systems making these boundaries explicit is helpful in interpreting the mixed results that have been obtained we describe the consequences of the choice for each of these system boundaries and look at implications for innovation we also argue that the production and consumption system boundary offers potential for further advances in the field and deserves more attention in future research

turning back the clock in baseball the increased prominence of extrinsic rewards and demand for authenticity this paper addresses why customers at times prefer traditional practices deemed more authentic to a domain particularly where these practices had previously been discarded as inferior i argue that customer demand for authenticity can be triggered when extrinsic rewards i e fame or money increase in prominence in a market causing audiences to doubt the motives of the market s producers i examine this dynamic in the context of major league baseball where appreciation for traditional stadium features seemingly arose after the advent of free agency heightened awareness and coverage of the economic rewards in the sport experimental analysis validates the proposed mechanism whereby increased fan exposure to extrinsic rewards increases concern about player inauthenticity which increases preference for traditional stadium features quantitative analysis of attendance patterns provides external validation for these experimental findings by showing that authenticity was more highly preferred in the for

interdependences in the intrafirm diffusion of technological innovations confronting the rational and social accounts of diffusion this article investigates the intrafirm diffusion of technological innovations and the interdependences that exist among rival firms in this process previous research has offered two potential explanations for these interdependences social accounts in which they result from institutional pressures and rational accounts in which firms are interdependent as a result of how adoption by rivals affects expectations about the profitability of the technology the article offers two contributions first we propose a competitive interaction mechanism that is consistent with the fundamentals of rational accounts of diffusion second the empirical analysis shows the dominance of the proposed rational mechanism over social accounts of innovation diffusion in the generation of interdependences in the process of intrafirm diffusion

the social construction of market value institutionalization and learning perspectives on stock market reactions this study advances a social constructionist view of financial market behavior the paper suggests that the market s reaction to particular corporate practices such as stock repurchase plans are not as financial economists contend simply a function of the inherent efficiency of such practices rather stock market reactions are also influenced by the prevailing institutional logic and the degree of institutionalization of the practice the theory first predicts that the emergence of the agency perspective on corporate governance in the mid 1980s represented a powerful new institutional logic that would lead the market to reverse its prior aggregate reaction to stock repurchase plans in the united states the paper then considers the potential for institutional decoupling of repurchase plans and develops competing hypotheses about how the market value of these policies might have changed as more firms formally adopted but did not implement the plans over time in contrast to a financial economic pers

paying the price the impact of controversial governance practices on managerial reputation this study directly examines the reputational penalties that managers pay when they engage in controversial governance practices that raise questions about managerial self interest these penalties

the link between tax rates and foreign direct investment this paper investigates the impact of tax policy on foreign direct investment flows between the us and other countries using a panel data empirical approach using panel data is an attractive alternative to using single time series data because it provides greater statistical power and offers greater flexibility in terms of explanatory variables this study finds many significant factors influencing the transfer of funds component of foreign direct investment most noteworthy is that in addition to host and home country corporate tax rates having a significant effect on investment flows the host and home country income tax rates are also significant

corporate tax rates and foreign direct investment in the united states a significant research effort has been directed at establishing the determinants of foreign direct investment fdi with taxation policy identified as an important factor however the empirical literature has been limited in several respects with most work focused exclusively on host country tax regimes this paper seeks to extend the boundaries of fdi empirical inquiry by using a panel of nine investing tax exemption and tax credit countries over the period 1982 2000 constituting more than 85 of total us fdi inflows and incorporating home country tax rates to analyse two as yet unanswered questions first are corporate income tax rates an important determinant of fdi in the us secondly do investors from tax credit countries differ significantly in their tax response relative to those from tax exemption countries

strategic orientations incentive plan adoptions and firm performance evidence from electric utility firms this study examines the performance implications of the fit between strategic orientations and incentive plan characteristics research hypotheses are based on a framework that draws upon managerial discretion and agency theories to identify the links between firm strategy managerial motivation and control managerial risk bearing and incentive plan characteristics a pooled cross sectional time series research design is used to test hypotheses in a sample of 50 electric utility firms consistent with theory results indicate that annual bonus plans that use cash incentives and accounting measures of performance lead to better performance among firms with defender strategic orientations in contrast firms with prospector strategic orientations realize performance benefits when they adopt stock based incentive plans and use market measures to evaluate managerial performance 1997 john wiley sons ltd

does market oriented institutional change in an emerging economy make business group affiliated multinationals perform better an institution based view viewing market oriented institutional change as a two staged process we propose that the effects of market oriented institutional change on two organizational forms business group affiliated and independent firms are different depending on the stage of institutional change specifically we examine how the two distinct periods of market oriented institutional change that is institutional friction and institutional convergence affect business group affiliated firms and independent firms in their abilities to profit from international diversification using data on 140 korean manufacturing multinational firms from 1993 to 2003 we find that emerging economy firms face an international diversification discount a negative relationship between international diversification and firm performance we also find that business group affiliation affects the international diversification discount differently during the two periods of market oriented institutional change particularly when firm performance is measured by the market to book value mbv the moderating effect of business group affiliation on the relationship between international diversification and mbv is negative during the institutional frictions period but becomes positive during the institutional convergence period in the later stage of institutional change our findings warn against viewing market oriented institutional change as a discrete event highlighting the importance of recognizing the qualitatively distinctive nature of different periods of market oriented institutional change in future research

how do corporate governance model differences affect foreign direct investment in emerging economies this study examines the impact of national corporate governance models on inward foreign direct investment fdi in emerging economies we consider three potential mechanisms and conduct an empirical test of how family ownership and control in large group affiliated firms in taiwan affect joint venture investment from us and japanese firms during the period 1988 1998 results support the neo institutional perspective of fdi developed in this study the home country corporate governance models are likely to shape foreign firms choice of local partners

altered states taxes and the location of foreign direct investment in america this paper compares the distribution between u s states of investment from countries that grant foreign tax credits with investment from all other countries the ability to apply foreign tax credits against home country tax liabilities reduces an investor s incentive to avoid high tax foreign locations state corporate tax rate differences of 1 percent are associated with differences of 9 11 percent between the investment shares of foreign tax credit investors and the investment shares of all others suggesting that state taxes significantly influence the pattern of foreign direct investment in the united states copyright 1996 by american economic association

when in rome look like caesar investigating the link between demand side cultural power distance and ceo power agency theory grounded research on boards of directors and firm legitimacy has historically viewed ceo power as de legitimating often taking this fact for granted in theorizing about external assessors evaluations of a firm with few exceptions this literature has focused exclusively on capital market participants e g investors securities analysts as the arbiters of a firm s legitimacy and has accordingly assumed that legitimate governance arrangements are those derived from the shareholder oriented prescriptions of agency theory we extend this line of research in new ways by arguing that customers also externally assess firm legitimacy and that firms potentially adjust their governance characteristics to meet customers norms and expectations we argue that the cultural cognitive institutions prevalent in customers home countries influence their judgments regarding a firm s legitimacy such that firms competing heavily in highpower distance cultures are more likely to have powerful ceos with ceo power a source of legitimacy rather than illegitimacy among customers we also argue that the more dependent a firm is on its customers and the more salient cultural power distance is as a demand side institutional norm the greater this relationship will be data from 151 u s semiconductor and pharmaceutical firms over a 10 year period generally support our predictions

foreign direct investment in oecd countries a special focus in the case of greece foreign direct investment fdi is considered as an important instrument for economic development all over the world the aim of this paper is to examine the fdi inflows determinants for 24 oecd co

event studies in management research theoretical and empirical issues we examined the use of event studies in management research and found that there was inadequate attention paid to theoretical and research design issues this lack of attention may lead to false in

why is capital so immobile internationally possible explanations and implications for capital income taxation the evidence on international capital immobility is extensive including the lack of international portfolio diversification real interest differentials across countries and the high correlation between domestic savings and investment the authors develop a model with asymmetric information between countries that helps rationalize all the above observations and then examine the implications of this model for optimal domestic tax policy without asymmetric information past work showed that small open economies should not impose corporate income taxes with asymmetric information the optimal policy instead involves government subsidies to capital imports some omitted factors that argue against subsidizing capital imports are explored briefly copyright 1996 by american economic association

leaving the safety net an analysis of dropouts in an urban conditional cash transfer program summary in poverty reduction programs a significant number of beneficiaries change program status an analysis of oportunidades data from urban mexico shows that beneficiaries that drop out for behavioral and administrative reasons are those who are marginally eligible improving targeting through minimizing errors of inclusion results also indicate that the very poorest recipients particularly in large urban areas and less marginal communities are more likely to drop out increasing the errors of omission households deemed ineligible through a recertification process were those that had obtained basic durables or changed their demographic composition implying that oportunidades retargeting is based on limited information

taxation of investment and savings in a world economy the equilibrium of capital and equilibrium market prices are derived for a world economy with a unified securities market mobile capital no uncertainty and varying tax rates on different sources of income in each country the paper then characterizes optimal tax rates for a small country in this setting focusing on the peculiar incentives created when the before tax rate of return differs among securities due to differences in their typical tax treatment copyright 1986 by american economic association

distributional impacts of energy heat cross subsidization abstract energy and heat cross subsidies are common in developing and transitioning countries but the distributional and efficiency impacts of these policies and reform are largely unknown in post soviet countries such as belarus revenues from an industrial tariff on electricity are used to cross subsidize heating for households we analyze the distributional impacts of cross subsidy reform with both input output methods and a calibrated static computable general equilibrium cge model with heterogeneous households based on a household consumption survey on average gdp gains of roughly a quarter of a percent are computed across model runs which reduce taxes and subsidies from cross subsidization reducing household heating subsidy rates equally across income groups is found to be regressive poorer households are overly burdened due to higher heating expenditures while richer households enjoy gains from cheaper market prices for goods the gdp gains are even larger when the tax rates are structured to create a distributionally neutral reform