Corruption, Marketisation and Corporate Tax Management in China: Evidence from Listed Firms

Chen Zhang (), Kee-Cheok Cheong () and Rajah Rasiah
Additional contact information
Chen Zhang: Institute of Graduate Studies (IGS), University of Malaya
Kee-Cheok Cheong: Institute of China Studies, University of Malaya

Malaysian Journal of Economic Studies, 2017, vol. 54, issue 2, 281-299

Abstract: Most empirical research on the subject of tax management has emphasised the impact of internal corporate governance. Yet, the external governance mechanism regulating corporate behaviour is no less important, but far less studied. This study investigates how corruption and marketisation impact corporate tax management, which lowers corporate tax. It finds an inverted U-shape relationship between corruption and corporate tax management in China during the period of 2008 to 2013, with the effect positive at low to moderate levels of corruption and negative beyond these levels of corruption. However, marketisation, i.e., the greater reliance on market forces, is found to mitigate this impact of corruption on corporate tax management regardless of the level of corruption. In light of these findings, greater reliance on market institutions will directly and indirectly improve corporate decision making.

Keywords: China; corporate tax management; corruption; marketisaiton (search for similar items in EconPapers)
JEL-codes: D73 O53 P2 P3 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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: https://EconPapers.repec.org/RePEc:mjr:journl:v:54:y:2017:i:2:p:281-299

DOI: 10.22452/MJES.vol54no2.7

Access Statistics for this article

Malaysian Journal of Economic Studies is currently edited by Lim Kian Ping

More articles in Malaysian Journal of Economic Studies from Faculty of Business and Economics, University of Malaya & Malaysian Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Malaysian Economic Association ().