The impact of corporate tax avoidance on analyst coverage and forecasts
TL;DR: In this article, the authors show that analyst coverage is negatively associated with tax avoidance, but there is no evidence that the informativeness of, or errors in, analyst forecasts are associated with the tax avoidance.
read more
Abstract: Corporate tax avoidance is likely to be associated with a high level of earnings management and with high financial opacity in the time-series. On this basis, we hypothesize that analyst coverage is negatively associated with corporate tax avoidance. Our results confirm this conjecture, and are robust to using a firm-fixed-effects model and a quasi-natural experiment to control for potential endogeneity. Additional analysis shows that analyst coverage is negatively related to tax risk, but there is no evidence that the informativeness of, or errors in, analyst forecasts are associated with tax avoidance. Overall, our study advances understanding of the implications of corporate tax avoidance for analyst behavior.
read more
Chat with Paper
AI Agents for this Paper
Find similar papers on Google Scholar, PubMed and Arxiv
Write a critical review of this paper
Analyze citations of this paper to find unaddressed research gaps
Citations
Macro uncertainty, analyst performance, and managerial ability
TL;DR: This paper found that macro uncertainty measures are significantly and negatively correlated with the accuracy and informativeness of analysts' earnings forecasts and positively correlated with dispersion of earnings forecasts, and that the negative effects of macro uncertainty on analyst performance are significantly mitigated in firms with high managerial ability.
19
Corporate Tax Avoidance and Investment Efficiency: Evidence from the Enforcement of Tax Amnesty in Indonesia
TL;DR: In this article , the authors examined the investment efficiency of firms engaging in tax avoidance in Indonesia and found that tax avoidance is salient in both firms prone to underinvestment and overinvestment.
The Impact of Audit Characteristics on Corporate Tax Avoidance: The Moderating Role of Gender Diversity
TL;DR: In this paper, the authors investigated the relation between audit characteristics and corporate tax avoidance and how board gender diversity (BGDs) moderates this relationship, and found that the impact of the BGDs level increases as the presence of woman in the board escalated from 40 to 60 %, but then weakened at 10 % level.
17
The impact of insider trading on analyst coverage and forecasts.
Guanming He,David Marginson +1 more
TL;DR: Dechow et al. as discussed by the authors examined the effect of insider trading on analyst coverage and the properties of analyst earnings forecasts and found that insider trading increases the amount of information valuable to analyst services' knowledge.
References
•Book
Introductory Econometrics: A Modern Approach
Jeffrey M. Wooldridge
- 06 Aug 1999
TL;DR: In this article, the authors present a regression analysis with time series data using OLS asymptotics and a simple regression model in Matrix Algebra, which is based on the linear regression model.
13.3K
Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches
TL;DR: In this article, the authors examine the different methods used in the literature and explain when the different approaches yield the same (and correct) standard errors and when they diverge, and give researchers guidance for their use.
A caution regarding rules of thumb for variance inflation factors.
TL;DR: In this article, the authors examined the effect of the variance inflation factor (VIF) on the results of regression analyses, and found that threshold values of the VIF need to be evaluated in the context of several other factors that influence the variance of regression coefficients.
9.2K
•Book
Introductory econometrics : a modern approach
Jeffrey M. Wooldridge
- 01 Jan 2009
TL;DR: This paper presents a meta-modelling framework for Multiple Regression Analysis with Qualitative Information: Binary (or Dummy) Variables and Two Stage Least Squares, and discusses Serial Correlation and Heteroskedasticity in Time Series Regressions.
8.6K
The investment opportunity set and corporate financing, dividend, and compensation policies☆
Clifford W. Smith,Ross L. Watts +1 more
TL;DR: The authors examine explanations for corporate financing-, dividend-, and compensation-policy choices and find that contracting theories are more important in explaining cross-sectional variation in observed financial, dividend, and compensation policies than either tax-based or signaling theories.
4.3K