The relative constancy of nonfinancial corporate tax revenues as a share of U.S. GDP masks offsetting trends in the ratio of corporate profits to GDP (declining) and the average tax rate (increasing). The average tax rate rose steadily between 1996 and 2003, an increase largely attributable to the importance of tax losses. This rise casts some doubt on the role of tax planning activities in red...

This paper analyzes whether a corporate tax cut reduces profit shifting to low-tax countries. I use firm-level data of 2,812 German corporations around the Business Tax Reform in 2008. Applying a difference-in-differences framework with a one-onone matching strategy, which compares earnings of multinational and domestic corporations, I do not find empirical evidence that even a 10 percentage po...

This paper analyzes the persistence of corporate rates of return for 187 surviving US firms from 1950-1999 using a new dataset. The results go in line with the existing literature bringing more evidence for profit persistence. The problem of profit cycles is treated using autoregressive models up to order four. A surprising result is that among the firms that did not converge to the norm there ...

This paper analyzes the for-profit transformation of health care, with emphasis on Internet start-ups, physician practice management firms, insurance plans, and hospitals at various stages in the industry life cycle. Venture capital, conglomerate diversification, publicly traded equity, convertible bonds, retained earnings, and taxable corporate debt come with forms of financial accountability ...

Quality-of-care issues in the US dialysis industry have led to proposals to proscribe physician ownership of these facilities. The logic behind this approach relates to a profits/quality tradeoff created by the existing reimbursement structure. Given that tradeoff, separating ownership from quality-of-care decision making ostensibly could improve performance. Our empirical results, however, do ...

The resource-based view on firm diversification, subsequent to Penrose (1959), has focused primarily on the fungibility of resources across domains. We make a clear analytical distinction between scale-free capabilities and those that are subject to opportunity costs and must be allocated to one use or another, thereby shifting the discourse back to Penrose’s (1959) original argument regarding ...

Most jurisdictions exempt nonprofit firms from property, sales, and corporate income taxes in various industries, such as health care and education, in which both nonprofit and for-profit firms compete. Crosssection estimates using state tax data indicate that these exemptions significantly increase the market share of nonprofit firms vis-d-vis their for-profit counterparts. The relative market...

Today’s corporations are increasingly implementing responsible behaviours as they pursue profit-making activities. A thorosugh literature review suggests that there is a link between corporate social responsibility (CSR) or corporate social performance (CSP) and financial performance. In addition, there are relevant theoretical underpinnings and empirical studies that have often used other conc...