Essays on behavioral responses of multinational enterprises to international taxation [Elektronische Ressource] / vorgelegt von Georg Wamser

Georg Wamser

Informations

• Publié par: ludwig-maximilians-universitat_munchen
• Publié le: 01 janvier 2009
• Nombre de lectures: 8
• Langue: English

Extrait

Essays on
Behavioral Responses of Multinational
Enterprises to International Taxation
Inaugural-Dissertation
zur Erlangung des Grades
Doctor oeconomiae publicae (Dr. oec. publ.)
an der Ludwig-Maximilians-Universit˜at Munc˜ hen
2008
vorgelegt von
Georg Wamser
Referent: Prof. Dr. Thiess Buttner˜
Korreferent: Prof. Dr. Andreas Hau er
Promotionsabschlussberatung: 04. Februar 2009Acknowledgements
IthankThiessButtner˜ andAndreasHau erforagreeingtosupervisemythe-
sis. I am especially indebted to Thiess Buttner˜ for his encouragement and
support. I greatly beneflted from our close and productive collaboration,
which is re ected in his co-authorship of Chapter 4. I am also indebted to
MichaelOvereschwhoisco-authorofChapter2. Gratefulacknowledgements
are made to Ifo for providing me with an excellent research environment. I
thankallmycolleaguesattheDepartmentofPublicFinanceforthepleasant
working atmosphere. I owe a special debt to Chang Woon Nam and F¶ed¶eric
Holm-Hadulla for very helpful suggestions on Chapters 1 and 3. Beneflcial
contributionswerefurthergiveninnumerousdiscussionswithmyfellowdoc-
toral students Robert J˜ackle, Oliver R˜ohn, and Dirk Ulbricht. I am grateful
to the Deutsche Bundesbank, especially to Heinz Herrmann, Alexander Lip-
poner, and Elisabetta Fiorentino. I particularly appreciate the hospitality at
the research center in Frankfurt, where I conducted most of my research. I
am indebted to Gabriele Sosic as well as to Brigitta and John Francks for
editorial help. I would also like to thank the Ifo Institute and the Deutsche
Forschungsgemeinschaft (DFG) for flnancial support. Participants at confer-
ences and workshops in Brisbane, Chicago, Maastricht, Madrid, Mannheim,
Sevilla,andWarwickmadeveryvaluablecommentstoimprovethiswork. All
chaptersprofltedfromseminarpresentationsatCESandIfo. Iamespecially
indebted to Cristina Umani for things that would flll a longer dissertation
than this. Thanks to everyone else who has supported me along the way.Contents
Introduction x
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxi
1 Foreign (In)Direct Investment and Corporate Taxation 1
1.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Direct versus Indirect Investments . . . . . . . . . . . . . . . . 4
1.3 Theoretical Analysis . . . . . . . . . . . . . . . . . . . . . . . 9
1.3.1 Direct Structure (Regime I) . . . . . . . . . . . . . . . 9
1.3.2 Indirect Structure (Regime II) . . . . . . . . . . . . . . 12
1.3.3 Indirect Structure (Extended) . . . . . . . . . . . . . . 13
iCONTENTS ii
1.4 Investigation Approach . . . . . . . . . . . . . . . . . . . . . . 15
1.5 Data and Descriptive Statistics . . . . . . . . . . . . . . . . . 18
1.6 Regression Analysis . . . . . . . . . . . . . . . . . . . . . . . . 22
1.7 Sensitivity Analysis . . . . . . . . . . . . . . . . . . . . . . . . 27
1.8 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Appendix A: Selection Correction for Panel Data Models un-
der Conditional Mean Independence Assumption . . . . . . . . 30
Appendix B: First-Stage Regression Results, Data Sources,
Deflnitions, Sample Restrictions . . . . . . . . . . . . . . . . . 34
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . 37
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
2 CorporateTaxPlanningandThin-CapitalizationRules{Ev-
idence from a Quasi-Experiment 40
2.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
2.2 Some Institutional Details . . . . . . . . . . . . . . . . . . . . 44CONTENTS iii
2.3 A Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
2.4 Empirical Implications . . . . . . . . . . . . . . . . . . . . . . 51
2.5 Data and Descriptive Statistics . . . . . . . . . . . . . . . . . 54
2.6 Empirical Results . . . . . . . . . . . . . . . . . . . . . . . . . 57
2.7 Conclusions and Implications . . . . . . . . . . . . . . . . . . 63
Data Sources and Deflnitions . . . . . . . . . . . . . . . . . . 65
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . 65
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
3 The Impact of Thin-Capitalization Rules on External Debt
Usage { A Propensity Score Matching Approach 68
3.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
3.2 The German Thin-Capitalization Rule . . . . . . . . . . . . . 72
3.3 Theoretical Framework . . . . . . . . . . . . . . . . . . . . . . 73
3.3.1 Multinational Firm A. . . . . . . . . . . . . . . . . . . 74CONTENTS iv
3.3.2 Multinational Firm B . . . . . . . . . . . . . . . . . . . 76
3.4 Empirical Investigation Approach . . . . . . . . . . . . . . . . 78
3.4.1 Propensity Score Matching . . . . . . . . . . . . . . . . 81
3.4.2 Matching Methods . . . . . . . . . . . . . . . . . . . . 83
3.5 Data and Descriptive Statistics . . . . . . . . . . . . . . . . . 84
3.6 Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
3.6.1 Results for External Debt . . . . . . . . . . . . . . . . 88
3.6.2 Results for Internal Debt . . . . . . . . . . . . . . . . . 92
3.7 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . 100
Literature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100CONTENTS v
4 Internal Debt and Multinationals’ Tax Planning:
Empirical Evidence from Panel Data 106
4.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
4.2 Theoretical Considerations . . . . . . . . . . . . . . . . . . . . 110
4.3 Empirical Implications . . . . . . . . . . . . . . . . . . . . . . 113
4.4 Data and Investigation Approach . . . . . . . . . . . . . . . . 115
4.5 Descriptive Statistics . . . . . . . . . . . . . . . . . . . . . . . 119
4.6 Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
4.6.1 Taking Account of CFC Rules . . . . . . . . . . . . . . 130
4.6.2 Majority-Owned Subsidiaries . . . . . . . . . . . . . . 133
4.7 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
Data Sources and Deflnitions . . . . . . . . . . . . . . . . . . 137
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . 138
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138List of Tables
1 German Outbound FDI . . . . . . . . . . . . . . . . . . . xvi
1 German Outbound FDI, cont. . . . . . . . . . . . . . . . xvii
1 German Outbound FDI, cont. . . . . . . . . . . . . . . . xviii
1.1 Variable Description . . . . . . . . . . . . . . . . . . . . . 20
1.2 Regression Results (Sample Split) . . . . . . . . . . . . 23
1.3 Regression Results (Switching Regression) . . . . . . 24
1.4 Sample Selection Bias . . . . . . . . . . . . . . . . . . . . 26
1.5 Sensitivity Analysis (Switching Regression) . . . . . 28
1.6 Regime Identification . . . . . . . . . . . . . . . . . . . . 35
viLIST OF TABLES vii
1.7 Data Sources, Definitions, and Sample Restrictions 36
2.1 German Inbound FDI (1996 { 2004) . . . . . . . . . . . . 56
2.2 Descriptive Statistics . . . . . . . . . . . . . . . . . . . . 57
2.3 Thin-Capitalization Reform in 2001 (I) . . . . . . . . . 59
2.4 Thin-Capitalization Reform in 2001 (II) . . . . . . . . 60
2.5 Thin-Capitalization Reform in 2004 . . . . . . . . . . . 61
3.1 Country and Firm Characteristics . . . . . . . . . . . 85
3.2 Descriptive Statistics . . . . . . . . . . . . . . . . . . . . 87
3.3 PropensityScoreMatching,ShareofExternalDebt 89
3.4 PropensityScoreMatching, LevelofExternalDebt 90
3.5 Propensity Score Matching, Share of Internal Debt 91
3.6 Probability of Treatment . . . . . . . . . . . . . . . . . 97
3.7 Balancing Property . . . . . . . . . . . . . . . . . . . . . 98
3.8 Variable Definitions . . . . . . . . . . . . . . . . . . . . . 99LIST OF TABLES viii
4.1 Sample Characteristics . . . . . . . . . . . . . . . . . . . 120
4.2 Geographical Distribution of Affiliates. . . . . . . . 121
4.2 Distribution of Affiliates, cont. . . . 122
4.3 Descriptive Statistics . . . . . . . . . . . . . . . . . . . . 123
4.4 Leverage and Internal debt . . . . . . . . . . . . . . . . 124
4.5 Basic Results . . . . . . . . . . . . . . . . . . . . . . . . . . 128
4.6 CFC Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . 132
4.7 Majority-Owned Subsidiaries . . . . . . . . . . . . . . . 134