Three essays in financial accounting

Authors
Fang, Ming
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Other Contributors
Francis, Bill
Wu, Qiang
Clark, Brian J.
Hasan, Iftekhar
Issue Date
2015-12
Keywords
Management
Degree
PhD
Terms of Use
This electronic version is a licensed copy owned by Rensselaer Polytechnic Institute, Troy, NY. Copyright of original work retained by author.
Full Citation
Abstract
Chapter two studies the influence of CFO social networks on firm tax avoidance. I construct the social networks of the CFOs of US companies based on their employment history, education, and non-professional activities. I find that firms with central (well-connected) CFOs have lower effective tax rates (ETRs) than firms with non-central CFOs. Moreover, the ETR of a firm decreases if the CFO centrality of the firm increases. Furthermore, firm pairs have similar ETRs if their CFOs are socially connected, suggesting tax related information exchange among CFOs through social networks. The past ETRs of central CFOs predict the ETRs of non-central CFOs that they are socially connected with, suggesting that non-central CFOs follow central CFOs for tax planning. Overall, my findings suggest that socially well-connected CFOs have more information and resources to adopt aggressive tax strategies than not-well-connected CFOs.
Description
December 2015
School of Management
Department
Lally School of Management
Publisher
Rensselaer Polytechnic Institute, Troy, NY
Relationships
Rensselaer Theses and Dissertations Online Collection
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