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Taxes and the Location of Targets

Wiji Arulampalam (), Michael Devereux () and Federica Liberini ()

No 02/2017, Memorandum from Oslo University, Department of Economics

Abstract: We use firm-level data to investigate the impact of taxes on the international location of targets in M&A allowing for heterogeneous responses by companies. The statutory tax rate in the target country is found to have a negative impact on the probability of an acquisition in that country. In addition, the estimated size of the effect is found to depend on whether (i) acquirer is a domestic or a multinational enterprise; (ii) the acquisition is domestic or cross-border; and (iii) the acquirer's country has a worldwide or territorial tax system

Keywords: Multinational enterprises; cross-border expansion; target choice; corporation income tax; mixed logit (search for similar items in EconPapers)
JEL-codes: C25 G34 H25 H32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc, nep-cfn and nep-pbe
Date: 2017-02-28
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Related works:
Working Paper: Taxes and the Location of Targets (2018) Downloads
Working Paper: Taxes and the Location of Targets (2017) Downloads
Working Paper: Taxes and the Location of Targets (2017) Downloads
Working Paper: Taxes and the Location of Targets (2012) Downloads
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