Creat membership Creat membership
Sign in

Forgot password?

Confirm
  • Forgot password?
    Sign Up
  • Confirm
    Sign In
Creat membership Creat membership
Sign in

Forgot password?

Confirm
  • Forgot password?
    Sign Up
  • Confirm
    Sign In
Collection

toTop

If you have any feedback, Please follow the official account to submit feedback.

Turn on your phone and scan

home > search >

Tax avoidance, cost of debt and shareholder activism: Evidence from Korea

Author:
Youngdeok Lim  


Journal:
Journal of Banking and Finance


Issue Date:
2011


Abstract(summary):

This paper examines the impact of tax avoidance on the cost of debt and its interaction effect with shareholder activism. Using Korean firms, I find a negative relationship between tax avoidance and the cost of debt, supporting the trade-off theory. Further tests reveal that the negative relationship becomes stronger when the level of institutional ownership is high. It becomes even stronger after 1998, when the shareholder rights of institutional investors were strengthened. It suggests that the managerial opportunism theory has an additional explanation for tax avoidance activities. My findings indicate that tax avoidance reduces the cost of debt through trade-offs and creates a managerial rent diversion, which is mitigated in firms with larger institutional holdings.


Page:
0-470


Similar Literature

Submit Feedback

This function is a member function, members do not limit the number of downloads