We examine the financial and valuation consequences of corporate inversion using a sample of 12 inversion firms and 24 matched firms. We find that firms' effective tax rates (ETRs) decline substantially following inversion. Based on pre– to post–inversion changes in foreign profit margin,...

Contrary to the mixed evidence reported in prior studies that utilize volume-based metrics to examine the effect of taxes on short-term (Bolster et al., 1989; Henderson, 1990) and long-term (Henderson, 1990; Ricketts and Walter, 1997) trading activity, this study finds strong evidence that individual...