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A Peer-reviewed scientific articles/A1 Journal article (refereed), original research
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Does Social Capital Matter in Corporate Decisions? Evidence from Corporate Tax Avoidance, Journal of Accounting Research 3 June 2017 (2017). Hasan, Iftekhar; Hoi, Chunkeung; Wu, Qiang; Zhang, Hao

Category A Peer-reviewed scientific articles
Sub-category A1 Journal article (refereed), original research
auki Internal authors
All authors as text Hasan, Iftekhar; Hoi, Chunkeung; Wu, Qiang; Zhang, Hao 
Number of authors
Status Published
Year of publication 2017 
Date 17.01.2017 
Name of article Does Social Capital Matter in Corporate Decisions? Evidence from Corporate Tax Avoidance 
Name of journal Journal of Accounting Research
Volume of issue 55 
Number of issue 3 June 2017 
Pages 629-668 
Abstract We investigate whether the levels of social capital in U.S. counties, as captured by strength of civic norms and density of social networks in the counties, are systematically related to tax avoidance activities of corporations with headquarters located in the counties. We find strong negative associations between social capital and corporate tax avoidance, as captured by effective tax rates and book-tax differences. These results are incremental to the effects of local religiosity and firm culture toward socially irresponsible activities. They are robust to using organ donation as an alternative social capital proxy and fixed effect regressions. They extend to aggressive tax avoidance practices. Additionally, we provide corroborating evidence using firms with headquarters relocation that changes the exposure to social capital. We conclude that social capital surrounding corporate headquarters provides environmental influences constraining corporate tax avoidance.
Free text descriptor in Finnish sosiaaliset verkostot; verotus; sosiaalinen pääoma; yritykset; veronkierto; Yhdysvallat; piirikunnat 
Free text descriptor in English social capital, social network, social norm, tax aggressiveness, tax avoidance 
JEL-codes A13, H26, M40, M41, Z13 
ISSN / e-ISSN 0021-8456E 
auki Internet addresses
Additional information First published: 17 January 2017
Notes BoF DP 21/2017 
Open Access Not open

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