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Binned scatter plot of productivity (TFP) on cash ETR (CETR)

Binned scatter plot of productivity (TFP) on cash ETR (CETR)

Source publication
Preprint
We examine the relation between corporate tax planning and firm-level productivity. Using a sample of U.S.-listed firms from 1994 to 2017, we show that, ceteris paribus, lower effective tax rates lead to higher production efficiency. Consistent with the "funding gap" of innovative investments due to debt market frictions, the results indicate that...