We examine how creditor rights affect the trade-off between non-debt and debt tax shields. Using four bankruptcy reforms, a panel of private and public firms, and tax return data from Italy, we show that laws empowering creditors reduce tax avoidance and increase debt financing, consistent with...

This paper examines the effect of labor protection laws on tax planning and capital investment. Exploiting a major reform that introduced firing costs in Italy for firms with fewer than 15 employees but left firing costs unchanged for larger firms combined with matched employer-employee data, I...

This paper examines whether the profit-shifting trend in Europe during 2003–2013 can be explained by tax policy changes. Consistent with prior literature, we find that affiliates' profits are sensitive to tax rate changes. However, we document that tax base–broadening reforms have mitigated...