Corporate tax avoidance and industry concentration
Julien Martin,
Mathieu Parenti () and
Farid Toubal
Working Papers from CEPII research center
Abstract:
This paper argues that tax avoidance by large corporations has contributed to the 25% increase in concentration among U.S. firms since the mid-1990s. Corporate tax avoidance gives large firms a competitive edge, which translates into larger market shares and an increase in the granularity of the economy. We develop IV and difference-in-differences strategies that show the causal impact of tax avoidance on firm-level sales. Had firms not resorted to tax avoidance in 2017, our results imply that the average industry concentration would have been 8.3% lower, which is around its early 2000 level.
Keywords: Tax Avoidance; Industry Concentration; IRS Audit Probability (search for similar items in EconPapers)
JEL-codes: D22 D4 F23 H26 L11 (search for similar items in EconPapers)
Date: 2020-07
New Economics Papers: this item is included in nep-acc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)
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http://www.cepii.fr/PDF_PUB/wp/2020/wp2020-09.pdf (application/pdf)
Related works:
Working Paper: Corporate Tax Avoidance and Industry Concentration (2021)
Working Paper: Corporate Tax Avoidance and Industry Concentration (2021)
Working Paper: Corporate Tax Avoidance and Industry Concentration (2020) 
Working Paper: Corporate Tax Avoidance and Industry Concentration (2020) 
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Persistent link: https://EconPapers.repec.org/RePEc:cii:cepidt:2020-09
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