Following the release of the Panama Papers and the Paradise Papers, there has been renewed research into profit shifting by multinational firms. This column utilises a novel dataset to show that well-managed subsidiaries, independently of their headquarters, allow a company to be more responsive to tax changes, shifting more profits from high-tax to low-tax jurisdictions. The authors argue this is because better managed subsidiaries allow more effective tax planning by headquaters and are better placed to implement HQ directives.

---

4 September 2024

---

Vox EU

---

https://cepr.org/voxeu/columns/good-management-practices-are-great-productivity-well-profit-shifting

This Blog is published under the centre's Growth programme.

This publication comes under the following theme: Management practices and productivity