Executive Characteristics,Tax Avoidance And Corporate Value

Tax avoidance is an important issue in thesis of tax area,including influence factors and economic effects.Existing researches on influence factors of tax avoidance mainly focus on company character,corporate governance and etc.They all base on the hypothesis of rational man in traditional tax theory.However,with the development of upper echelons theory and behavioral financial theory,issues that different executives have different business decisions and different corporate value has been raised in the mind of scholars overseas and domestic.This thesis hypothesis and empirical test whether executive characteristic will influence corporate tax avoidance,which means extrinsic characteristics of executives(age,gender,degree,etc.)reflect intrinsic characteristics(risk preference,overconfidence,tax avoidance motives,etc.)and executives with such characteristics tend to perform tax avoidance.An important issue of economic effects of tax avoidance is the influence tax avoidance putting on corporate value.Traditional tax avoidance theory believes cash flow benefit brought by tax avoidance will improve corporate value significantly.But principal-agent theory thinks corporate value will decrease by executives’ tax avoidance.This thesis first discusses the relationship between tax avoidance and corporate value under dialectical analysis of above theories and then takes executives’ characteristic under consideration to test whether executives’ characteristic will influence the relationship of tax avoidance and corporate value.The result of the empirical test of A-share listed companies in Shanghai and Shenzhen stock market from 2000 to 2015 shows that compared with women executives,men executives tend more to perform tax avoidance.Compared with young executives,old executives tend more to perform tax avoidance.Executives with higher degree tend more to perform tax avoidance.Executives with short tenure tend more to perform tax avoidance.In terms of the relationship of tax avoidance and corporate value,due to cash flow increase brought by tax avoidance is greater than the principal agent cost,corporate value increases,which prove the hypothesis.When it comes to executive characteristics,the results show that compared with female executives,male executives have negative influence on the relationship of tax avoidance and corporate value.Tax avoidance performed by older executives and executives with high tenure will increase more corporate value.While influence of high degree on relationship of tax avoidance and corporate value hasn’t been revealed.Based on above analysis,this thesis enriches research on influence factors of tax avoidance,enriches applications of upper echelons theory and behavioral financial theory and enriches research system of value of tax avoidance.