Firm size and taxes

Chongvilaivan, Aekapol; Jinjarak, Yothin

Abstract

The scale dependence in firm growth (smaller firms grow faster) is systematically reflected in the size distribution. This paper studies whether taxes affect the equilibrium firm size distribution in a cross-country context. The main finding is that the empirical association between firm growth and corporate tax (VAT) is positive (negative), with notable differences in the response of manufacturing firms and that of the others. We draw implications for recent debate on the impact of taxes and tax avoidance on the organization of firms in the economy.

Citation

Chongvilaivan, A., & Jinjarak, Y. (2010). Firm size and taxes. Journal of the Korean Economy, 11(1), 145-175

• Journal Article Type: Article
• Publication Date: Jan 1, 2010
• Deposit Date: Aug 25, 2010
• Publicly Available Date: Mar 10, 2025
• Journal: Journal of the Korean Economy
• Print ISSN: 1598-2750
• Peer Reviewed: Peer Reviewed
• Volume: 11
• Issue: 1
• Pages: 145-175