The Effect of Tax System Characteristics on Cross-Border Mergers and Acquisitions

ABSTRACT Although determinants of cross-border merger and acquisitions (M&As) have received substantial attention in the literature, research examining effect tax system characteristics on M&As is more limited. Cross-border implications for both acquiring firm target firm. Because firms evaluate investments based expected after-tax returns, I expect that managers consider potential savings or costs making investment decisions across jurisdictions. In this study, use hand-collected country-year-level to examine volume direction M&As. find such as controlled foreign corporation provisions, thin capitalization presence a worldwide versus territorial regime significant M&A activity. JEL Classifications: G34; G38; H25; H26. Data Availability: All data are available from sources identified text.