The Tax Sparing Provision Influence: A Credit versus Exempt Investors Analysis

This paper is concerned with the impact of tax sparing provisions on the location choices of multinational enterprises. Special attention is paid to the economic in°uence of tax sparing because the OECD proposal to reconsider the inclusion of this provision in bilateral tax treaties is highly controversial. An empirical analysis is proposed in order to apprehend the effects of tax sparing on both credit and exempt investors, since they do not benefit from the same advantages provided by tax sparing. Using data from 54 developing countries over the 1990-2000, and distinguishing Japanese credit investors from French exempt investors, we first find that the asymmetrical sensitivity between exempt and credit investors relative to foreign corporate taxes is considerably reduced with tax measures accounting for tax sparing. Second, we find that tax sparing provisions have a favorable impact on the location choices of credit investors and have no influence on the location choices of exempt investors. Third, the non-robust significance of both a tax sparing adjusted effective interest tax rate and effective royalties tax rate tends to suggest that tax incentives on passive incomes are not really considered by both credit and exempt investors when making the decision of where to invest.foreign direct investment, tax sparing, credit and exempt tax systems, corporate taxes, interest and royalty taxes

Uncertainty, Imitation, and Plant Location: Japanese Multinational Corporations, 1990‐1996

In a study of a sample of 2,705 international plant location decisions by listed Japanese multinational corporations across a possible set of 155 countries in the 1990-1996 period, we use neoinstitutional theory and research on political institutions to explain organizational entry into new geographic markets. We extend neoinstitutional theory\u27s proposition that prior decisions and actions by other organizations provide legitimization and information to a decision marked by uncertainty, showing that this effect holds when the uncertainty comes from a firm\u27s lack of experience in a market but not when the uncertainty derives from the structure of a market\u27s policymaking apparatus

Cohesion, COVID-19 and contemporary challenges to globalization

In the years preceding the COVID-19 pandemic, the decades-long, pan-continental globalization consensus was being questioned. In our view, the pandemic has accelerated the rate at which the globalization consensus is being defied. To better understand the implications of this defiance, we turn to research on people, organizations and international competition to see whether this defiance weakens the cohesion needed to keep globalization moving apace. People and organizations create cohesive forces that can link and constrain the differences that are encountered when people and organizations move across international borders. Meanwhile, the nature of international competition, particularly as connected to the level of active involvement by state actors, can lead to fractures that reduce cohesion across polities and societies

Taxation and the international strategy of Japanese multinational enterprises

This paper analyzes the effect of statutory tax rates on the location of Japanese capital in emerging countries. Considering the fact that the difference between Japan and foreign tax rates can engender transfer pricing manipulation to diminish tax liabilities, and that some firms are more able to manipulate transfer pricing, such as wholly-owned ventures and high technology affiliates, we investigate the sensitivity of Japanese capital to foreign tax rates by distinguishing wholly-owned ventures from joint-ventures and high R&D affiliates from low R&D affiliates. Based on country, parent firm and sector characteristics an investment equation is estimated on a sample of 3774 Japanese affiliates in 49 emerging countries. We obtain a greater semi-elasticity between investment and the statutory tax rate for wholly-owned affiliates and R&D intensive parents. We interpret these results as indirect evidence for abusive transfer pricing to be one of the determinants of FDI flows.Nous analysons l'effet des taux statutaires d'impôt sur les sociétés sur l'investissement direct japonais dans les pays émergents. Les écarts de taux entre le Japon et les pays hôtes créent des incitations à la manipulation des prix de transfert. Nous nous intéressons à la sensibilité à l'impôt de certains investissements plus susceptibles d'en bénéficier, telles que ceux dans les filiales détenues à 100%, ou pour lesquels la recherche et développement joue un rôle majeur. Nous estimons une équation d'investissement comprenant des caractéristiques du pays hôte, du secteur et de la firme mère à partir d'un échantillon de 3774 filiales de firmes japonaises localisées dans 49 pays. Nous obtenons une semi-élasticité de l'investissement au taux d'impôt statutaire plus élevée dans les cas de filiales détenues à 100% et de firmes mères intensives en recherche et développement. Nous interprétons ces résultats comme une preuve indirecte que la manipulation des prix de transfert appartient aux déterminants des flux d'investissement direct

Japanese Investment in Transitional Economies: Characteristics and Performance

This paper presents and analyzes comparative data on 2,343 foreign-owned organizations operating in the transitional economies of China, Viet Nam and the countries of Central and Eastern Europe (CEE). Specifically, it compares the extent, sectoral distribution, characteristics and performance of Japanese subsidiaries established in these three regions. Among the three, most Japanese investment has flowed to China where subsidiary performance was highest and where subsidiaries were concentrated in the manufacturing sector. Further, the employment levels of expatriate managers, and the propensity to engage in joint ventures, were higher in China and Viet Nam. The tighter linkages between domestic and foreign organizations, and the greater incidence of investment, provided more significant opportunities and scope for the transfer of organizational practices, and change, in domestic incumbents in China and Viet Nam than in the CEE.

Do shareholders or stakeholders appropriate the rents from corporate diversification? The influence of ownership structure

Academy of Management Journal533636-65

Examining the generalizability of research findings from archival data

This initiative examined systematically the extent to which a large set of archival research findings generalizes across contexts. We repeated the key analyses for 29 original strategic management effects in the same context (direct reproduction) as well as in 52 novel time periods and geographies; 45% of the reproductions returned results matching the original reports together with 55% of tests in different spans of years and 40% of tests in novel geographies. Some original findings were associated with multiple new tests. Reproducibility was the best predictor of generalizability—for the findings that proved directly reproducible, 84% emerged in other available time periods and 57% emerged in other geographies. Overall, only limited empirical evidence emerged for context sensitivity. In a forecasting survey, independent scientists were able to anticipate which effects would find support in tests in new samples.publishedVersio

Planned Marketing Adaptation and Multinationals' Choices Between Acquisitions and Greenfields

International marketing studies have extensively examined the antecedents of firms' marketing standardization/ adaptation decisions. However, it is unclear whether such decisions, once planned, codetermine the choice between buying and building foreign subsidiaries. Analyzing a sample of 150 foreign entries by Dutch firms, the authors find that the level of marketing adaptation planned for a wholly owned subsidiary is positively related to the likelihood that the subsidiary will be established through an acquisition rather than through a greenfield investment. Moreover, the authors find substantial evidence that this positive relationship is stronger for firms that (1) are establishing relatively larger subsidiaries, (2) have less experience with the industry entered, or (3) are entering less developed countries. The findings show that firms pursuing higher levels of marketing adaptation assign more value to the marketing adaptation advantages of acquisitions over greenfields, especially if the risks associated with implementing the planned adaptation level are high. In addition, firms typically strive for a fit between their international marketing strategy and their mode of foreign establishment. (authors' abstract

Mental Disorder Symptoms during the COVID-19 Pandemic in Latin America – A Systematic Review and Meta-analysis

Aims There is a lack of evidence related to the prevalence of mental health symptoms as well as their heterogeneities during the coronavirus disease 2019 (COVID-19) pandemic in Latin America, a large area spanning the equator. The current study aims to provide meta-analytical evidence on mental health symptoms during COVID-19 among frontline healthcare workers, general healthcare workers, the general population and university students in Latin America. Methods Bibliographical databases, such as PubMed, Embase, Web of Science, PsycINFO and medRxiv, were systematically searched to identify pertinent studies up to August 13, 2021. Two coders performed the screening using predefined eligibility criteria. Studies were assigned quality scores using the Mixed Methods Appraisal Tool. The double data extraction method was used to minimise data entry errors. Results A total of 62 studies with 196 950 participants in Latin America were identified. The pooled prevalence of anxiety, depression, distress and insomnia was 35%, 35%, 32% and 35%, respectively. There was a higher prevalence of mental health symptoms in South America compared to Central America (36% v. 28%, p \u3c 0.001), in countries speaking Portuguese (40%) v. Spanish (30%). The pooled prevalence of mental health symptoms in the general population, general healthcare workers, frontline healthcare workers and students in Latin America was 37%, 34%, 33% and 45%, respectively. Conclusions The high yet heterogenous level of prevalence of mental health symptoms emphasises the need for appropriate identification of psychological interventions in Latin America