Do stock prices affect corporate tax behavior? Available to Purchase

This study aims to examine how firm-specific information in stock prices influences corporate tax behavior.

This study uses ordinary least squares (OLS) regressions to examine the association between stock price informativeness and effective tax rate (ETR) volatility.

Stock price informativeness is positively associated with short-term tax avoidance as measured by ETR volatility.

While prior research examines the association between market activity and the level of ETRs, this study examines other various aspects of tax behavior.