Profit shifting activities of multinational enterprises (MNEs) result in base erosion in high-tax countries. Tax-motivated profit shifting may distort real investments of MNEs and encourage economies to engage in tax competition. To address the loss of tax revenues in high-tax jurisdictions, the...

This is one of the first studies which systematically investigate whether specific characteristics of foreign affiliates that reflect their MNE investment motivations prolong or undermine affiliate survivorship when the host country becomes member of a regional economic union. Using a unique...