Economics at your fingertips  

U.S. worldwide taxation and domestic mergers and acquisitions

Jeremiah Harris () and William O'Brien

Journal of Accounting and Economics, 2018, vol. 66, issue 2, 419-438

Abstract: This study shows that domestic mergers and acquisitions (M&A) were inhibited by the U.S.’s worldwide tax policy on foreign-earned income. Double Irish structures, a complex web of subsidiaries that reduce foreign tax rates and therefore increase potential repatriation tax rates, are associated with lower levels of domestic M&A by U.S. firms. These results do not reflect a continuation of prior trends or declines in worldwide acquisitiveness and are robust to several econometric approaches. We suggest that the Double Irish variable mitigates a confounding effect in an alternative tax variable that clouds inferences in tests of repatriation taxes and domestic M&A.

Keywords: Acquisitions; Repatriation; Taxes (search for similar items in EconPapers)
JEL-codes: F23 G34 G38 H21 H26 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Journal of Accounting and Economics is currently edited by J. L. Zimmerman, S. P. Kothari, T. Z. Lys and R. L. Watts

More articles in Journal of Accounting and Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2019-11-09
Handle: RePEc:eee:jaecon:v:66:y:2018:i:2:p:419-438