The economic effects of special purpose entities on corporate tax avoidance

This study provides the first large‐sample evidence on the economic tax effects of special purpose entities (SPEs). These increasingly common organizational structures facilitate corporate tax savings by enabling sponsor‐firms to increase tax‐advantaged activities and/or enhance their tax efficiency (i.e., relative tax savings of a given activity). Using path analysis, we find that SPEs facilitate greater tax avoidance, such that an economically large amount of cash tax savings from research and development (R&D), depreciable assets, net operating loss carryforwards, intangible assets, foreign operations, and tax havens occur in conjunction with SPE use. We estimate that SPEs help generate over $330 billion of incremental cash tax savings, or roughly 6% of total U.S. federal corporate income tax collections during the sample period. Interaction analyses reveal that SPEs enhance the tax efficiency of intangibles and R&D by 61.5% to 87.5%. Overall, these findings provide economic insight into complex organizational structures supporting corporate tax avoidance.Accepted manuscrip

Augmenter of liver regeneration

‘Augmenter of liver regeneration’ (ALR) (also known as hepatic stimulatory substance or hepatopoietin) was originally found to promote growth of hepatocytes in the regenerating or injured liver. ALR is expressed ubiquitously in all organs, and exclusively in hepatocytes in the liver. ALR, a survival factor for hepatocytes, exhibits significant homology with ERV1 (essential for respiration and viability) protein that is essential for the survival of the yeast, Saccharomyces cerevisiae. ALR comprises 198 to 205 amino acids (approximately 22 kDa), but is post-translationally modified to three high molecular weight species (approximately 38 to 42 kDa) found in hepatocytes. ALR is present in mitochondria, cytosol, endoplasmic reticulum, and nucleus. Mitochondrial ALR may be involved in oxidative phosphorylation, but also functions as sulfhydryl oxidase and cytochrome c reductase, and causes Fe/S maturation of proteins. ALR, secreted by hepatocytes, stimulates synthesis of TNF-α, IL-6, and nitric oxide in Kupffer cells via a G-protein coupled receptor. While the 22 kDa rat recombinant ALR does not stimulate DNA synthesis in hepatocytes, the short form (15 kDa) of human recombinant ALR was reported to be equipotent as or even stronger than TGF-α or HGF as a mitogen for hepatocytes. Altered serum ALR levels in certain pathological conditions suggest that it may be a diagnostic marker for liver injury/disease. Although ALR appears to have multiple functions, the knowledge of its role in various organs, including the liver, is extremely inadequate, and it is not known whether different ALR species have distinct functions. Future research should provide better understanding of the expression and functions of this enigmatic molecule

Competitive externalities of tax cuts

Please note: this work is permanently embargoed in OpenBU. No public access is forecasted for this item. To request private access, please click on the locked Download file link and fill out the appropriate web form.We examine how tax cuts that benefit some firms are related to the economic performance of their direct competitors. Consistent with tax cuts decreasing the cost associated with initiating competitive strategies, we find that the decrease in the tax burden for only a certain group of firms in the U.S. economy has a negative economic effect on the performance of its direct competitors not directly exposed to the same tax cut. This negative externality is stronger when competitors face financial constraints, operate in more concentrated markets, and have similar products to their rivals. We also find that both investors and lenders price the negative externality manifested in these competitors’ economic performance.https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3265532First author draft2031-01-01First author draf

The Level of ALR is Regulated by the Quantity of Mitochondrial DNA.

Augmenter of liver regeneration (ALR) contributes to mitochondrial biogenesis, maintenance and to the physiological operation of mitochondria. The depletion of ALR has been widely studied and had serious consequences on the mitochondrial functions. However the inverse direction, the effect of the depletion of mitochondrial electron transfer chain and mtDNA on ALR expression has not been investigated yet. Thus mtDNA depleted, rho0 cell line was prepared to investigate the role of mitochondrial electron transfer chain and mtDNA on ALR expression. The depletion of mtDNA has not caused any difference at mRNA level, but at protein level the expression of ALR has been markedly increased. The regulatory role of ATP and ROS levels could be ruled out because the treatment of the parental cell line with different respiratory inhibitors and uncoupling agent could not provoke any changes in the protein level of ALR. The effect of mtDNA depletion on the protein level of ALR has been proved not to be liver specific, since the phenomenon could be observed in the case of two other, non-hepatic cell lines. It seems the level of mtDNA and/or its products may have regulatory role on the protein level of ALR. The up-regulation of ALR can be a part of the adaptive response in rho0 cells that preserves the structural integrity and the transmembrane potential despite the absence of protein components encoded by the mtDNA