https://isiarticles.com/bundles/Article/pre/pdf/41674.pdf

Foreign investors' interests and corporate tax avoidance: Evidence from an emerging economy

Scholars in management and economics widely share the assumption that business firms focus on profits only, while it is the task of the state system to provide public goods. In this view business firms are conceived of as economic actors, and governments and their state agencies are considered the only political actors. We suggest that, under the conditions of globalization, the strict division of labour between private business and nation-state governance does not hold any more. Many business firms have started to assume social and political responsibilities that go beyond legal requirements and fill the regulatory vacuum in global governance. Our review of the literature shows that there are a growing number of publications from various disciplines that propose a politicized concept of corporate social responsibility. We consider the implications of this new perspective for theorizing about the business firm, governance, and democracy.

https://www.springer.com/cda/content/document/cda_downloaddocument/9783834931795-c1.pdf?SGWID=0-0-45-1347110-p174325274

The New Political Role of Business in a Globalized World: A Review of a New Perspective on CSR and its Implications for the Firm, Governance, and Democracy

In an era of rising concern about financial performance and social ills, companies’ economic achievements and negative externalities prompt a common question: Does it pay to be good? For thirty-five years, researchers have been investigating the empirical link between corporate social performance (CSP) and corporate financial performance (CFP). In the most comprehensive review of this research to date, we conduct a meta-analysis of 251 studies presented in 214 manuscripts. The overall effect is positive but small (mean r = .13, median r = .09, weighted r = .11), and results for the 106 studies from the past decade are even smaller. We also conduct sensitivity analyses to determine whether or not the relationship is stronger under certain conditions. Except for the effect of revealed misdeeds on financial performance, none of the many contingencies examined in the literature markedly affects the results. Therefore, we conclude by considering whether, aside from striving to do no harm, companies have grounds for doing good - and whether researchers have grounds for continuing to look for an empirical link between CSP and CFP.

Does it Pay to Be Good...And Does it Matter? A Meta-Analysis of the Relationship between Corporate Social and Financial Performance

This article presents a review of the book “Organizations: Rational, Natural and Open Systems,” by W.R. Scott.

Organizations: Rational, Natural and Open Systems

Value Maximization, Stakeholder Theory, and the Corporate Objective Function

The current age of globalization can be distinguished from the previous one (from 1870 to 1914) by the much higher mobility of capital than labor (in the previous age, before immigration restrictions, labor was at least as mobile as capital). This increased mobility is the result of technological changes (the ability to move funds electronically) and the relaxation of exchange controls. The mobility of capital is linked to tax competition, in which sovereign countries lower their tax rates on income earned by foreigners within their borders in order to attract both portfolio and direct investment. Tax competition, in turn, threatens to undermine the individual and corporate income taxes, which traditionally have been the main source of revenue (in terms of percentage of total revenue collected) for modern welfare states. The response of developed countries has been first, to shift the tax burden from (mobile) capital to (less mobile) labor, and second, when further increased taxation of labor becomes politically and economically difficult, to cut the social safety net. Thus, globalization and tax competition lead to a fiscal crisis for countries that wish to continue to provide social insurance to their citizens at the same time that demographic factors and the increased income inequality, job insecurity, and income volatility that result from globalization render such social insurance more necessary. The result is increasing pressure to limit globalization (e.g., by re-introducing exchange controls) which risks reducing world welfare. This article argues that if both globalization and social insurance are to be maintained, it is necessary to cut the intermediate link by limiting tax competition in a way that is congruent with maintaining the ability of democratic states to determine the desirable size of their government.

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Globalization, Tax Competition and the Fiscal Crisis of the Welfare State

/pdf/globalization-tax-competition-and-the-fiscal-crisis-of-the-141meuoq3z.pdf

Globalization, Tax Competition, and the Fiscal Crisis of the Welfare State

Congress is likely to consider domestic climate change legislation during 2009, with a cap-and-trade system continuing to draw support from the Obama Administration and many leaders in Congress. Yet cap-and-trade regulations would take years for EPA to develop and implement, the desired price signal for carbon dioxide might be difficult to achieve until years later, and administration and enforcement of a comprehensive cap and trade system poses significant challenges. The urgency of the climate change crisis calls for immediate action, which can be provided best by a carbon tax imposed on all coal, natural gas, and oil produced in the United States and imported from other countries. A carbon tax could be implemented and enforced without the need for a complex new regulatory scheme and would provide an immediate carbon price signal. In addition, revenue from a carbon tax could support research and development of alternative energy and ease any regressive effects of the tax. Moreover, adoption of a carbon tax during 2009 would provide the United States much needed credibility on climate change issues and would allow the United States to focus its climate change efforts on negotiation of a new international agreement that provides meaningful carbon dioxide emission reductions by industrialized nations and less developed countries.

/pdf/combating-global-climate-change-why-a-carbon-tax-is-a-better-owcqi8qnoy.pdf

Combating global climate change: why a carbon tax is a better response to global warming than cap and trade

The current system of taxing the income of multinational firms in the United States is flawed across multiple dimensions. The system provides an artificial tax incentive to earn income in low-tax countries, rewards aggressive tax planning, and is not compatible with any common metrics of efficiency. The U.S. system is also notoriously complex; observers are nearly unanimous in lamenting the heavy compliance burdens and the impracticality of coherent enforcement. Further, despite a corporate tax rate one standard deviation above that of other OECD countries, the U.S. corporate tax system raises relatively little revenue, due in part to the shifting of income outside the U.S. tax base. In this proposal, we advocate moving to a system of formulary apportionment for taxing the corporate income of multinational firms. Under our proposal, the U.S. tax base for multinational corporations would be calculated based on a fraction of their worldwide incomes. This fraction would be the sum of (1) a fixed return on their expenses in the United States and (2) the share of their worldwide sales that occur in the United States. This system is similar in significant respects to the current "residual profit split" method of the U.S. transfer pricing regulations and the OECD Guidelines, as well as to the current method that U.S. states use to allocate national income across states.

/pdf/allocating-business-profits-for-tax-purposes-a-proposal-to-4dpgyvos0v.pdf

Allocating Business Profits for Tax Purposes: A Proposal to Adopt a Formulary Profit Split

This book examines the coherent international tax regime that is embodied in both the tax treaty network and in domestic laws, and the way it forms a significant part of international law, both treaty based and customary. The practical implication is that countries are not free to adopt any international tax rules they please, but rather operate in the context of the regime, which changes in the same ways international law changes over time. Thus, unilateral action is possible, but is also restricted, and countries are generally reluctant to take unilateral actions that violate the basic norms that underlie the regime. The book explains the structure of the international tax regime and analyzes in detail how US tax law embodies the underlying norms of the regime.

/pdf/international-tax-as-international-law-an-analysis-of-the-1yh4h1j71c.pdf

Reuven S. Avi-Yonah

Papers

Globalization, Tax Competition and the Fiscal Crisis of the Welfare State

Globalization, Tax Competition, and the Fiscal Crisis of the Welfare State

Combating global climate change: why a carbon tax is a better response to global warming than cap and trade

Allocating Business Profits for Tax Purposes: A Proposal to Adopt a Formulary Profit Split

International Tax as International Law: An Analysis of the International Tax Regime