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Corporate tax avoidance and cash holdings: The role of institutional investors’ investment horizons

Afef Slama

International Journal of Financial Engineering2025https://doi.org/10.1142/s2424786325500082article
ABDC C
Weight
0.37

What the paper says

The purpose of this paper is to shed light on the ambiguity surrounding corporate tax avoidance and cash holdings relationship. It also investigates whether institutional investors (II)’ horizon affects this relationship. Based on a sample of 200 French listed firms from 2008 to 2017 and using the GMM estimator, the results reveal that tax avoidance practices significantly increase the company’s cash holdings levels suggesting that managers use tax avoidance to opportunistically extract cash. Moreover, the results show that the positive effect of tax avoidance on cash holdings is more prevalent in the presence of II with a short-term horizon. Conversely, long-term II curb the company’s incentives to increase its cash reserves from tax reduction activities.

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https://doi.org/https://doi.org/10.1142/s2424786325500082

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@article{afef2025,
  title        = {{Corporate tax avoidance and cash holdings: The role of institutional investors’ investment horizons}},
  author       = {Afef Slama},
  journal      = {International Journal of Financial Engineering},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1142/s2424786325500082},
}

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Corporate tax avoidance and cash holdings: The role of institutional investors’ investment horizons

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Evidence weight

0.37

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.16 × 0.4 = 0.06
M · momentum0.53 × 0.15 = 0.08
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.