nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2022‒08‒29
five papers chosen by

  1. Corporate Taxes Reduce Investment: New Evidence from Germany By Sebastian Link; Manuel Menkhoff; Andreas Peichl; Paul Schüle
  2. Maldives: Technical Assistance Report-Modernizing the Goods and Services Tax By International Monetary Fund
  3. South Africa: Financial Sector Assessment Program-Technical Note on Banking Regulation and Supervision By International Monetary Fund
  4. Distributions of Posterior Quantiles and Economic Applications By Kai Hao Yang; Alexander K. Zentefis
  5. Banking on Transparency for the Poor: Experimental Evidence from India By Erica M. Field; Natalia Rigol; Charity M. Troyer Moore; Rohini Pande; Simone G. Schaner

  1. By: Sebastian Link; Manuel Menkhoff; Andreas Peichl; Paul Schüle
    Abstract: This policy brief provides novel empirical evidence on the causal effect of increasing corporate taxes on firm investment. The study combines unique data on investment plans and their realizations of firms in the German industrial sector and data on more than 1,400 local tax changes in the specific system of business taxation in Germany. We show that firms reduce their investments if corporate taxes were increased. An increase of corporate tax rates to stabilize fiscal revenues would be especially costly during recessions. We conclude that fiscal policy should therefore avoid higher corporate taxation in times of economic crisis. Moreover, our results have implications for the op-timal design of fiscal federalism in Germany. Strong dependencies of municipalities on local business tax revenues should be avoided, as they can be very harmful during recessions.
    Date: 2022
  2. By: International Monetary Fund
    Abstract: This report reviews the Goods and Services Tax (GST) regime in the Maldives and identifies policy and legal reform options to support its modernization, as well as enhancing efficiency, equity, and revenue mobilization. Despite five existing amendments to the Goods and Services Tax Act (GSTA) and 28 amendments to the associated regulations, the core parameters of the GST have barely changed in nearly 12 years. In addition, rapid changes to global business models and the increasing digitalization of the Maldivian economy have made key features of the legislation – such as place of supply rules – increasingly inadequate. The mission identified several key GST policy reforms and proposed legal redrafting recommendations that should be prioritized by the authorities in the upcoming reform window. Table 1 summarizes the potential revenue implications and implementation timeline of the main policy measures proposed.
    Keywords: Act amendment; tourism Goods and Services Tax; VAT revenue; VAT C-efficiency; GST payment; Value-added tax; Digital currencies; Consumption taxes; Tourism; Tax allowances; Global; South Asia
    Date: 2022–06–16
  3. By: International Monetary Fund
    Abstract: The implementation of a twin peaks model represents a significant change to the South African financial supervisory architecture. The Prudential Authority (PA), operating within the administration of the South African Reserve Bank (SARB), is responsible for promoting and enhancing the safety and soundness of financial institutions that provide financial products and securities services. A separate authority, the Financial Sector Conduct Authority2 (FSCA), is responsible for market conduct regulation and supervision. The introduction of the twin peaks architecture was motivated by a need to increase the robustness of the financial sector regulatory and supervisory system, reinforce financial stability, improve protection of customers, and enhance cooperation among the regulators.
    Keywords: IMF-World Bank Financial Sector Assessment Program; WB staff; staff team of the International Monetary Fund; FSAP's finding; bank supervision department; H. liquidity risk; Bank supervision; Corporate governance; External audit; Auditing; Africa; Global
    Date: 2022–06–17
  4. By: Kai Hao Yang (Cowles Foundation and School of Management, Yale University); Alexander K. Zentefis (Yale School of Management)
    Abstract: We characterize the distributions of posterior quantiles under a given prior. Unlike the distributions of posterior means, which are known to be mean-preserving contractions of the prior, the distributions of posterior quantiles coincide with a first-order stochastic dominance interval bounded by an upper and a lower truncation of the prior. We apply this characterization to several environments, ranging across political economy, Bayesian persuasion, industrial organization, econometrics, finance, and accounting.
    Keywords: Posterior quantiles, stochastic dominance, gerrymandering, Bayesian persuasion, two-sided markets, quantile regression
    JEL: C31 D72 D82 D83 G28 L12 M41
    Date: 2022–03
  5. By: Erica M. Field; Natalia Rigol; Charity M. Troyer Moore; Rohini Pande; Simone G. Schaner
    Abstract: Do information frictions limit the benefits of financial inclusion drives for the rural poor? We evaluate an experimental intervention among recently banked poor Indian women receiving government cash transfers via direct deposit. Treated women were provided automated voice calls confirming details of transactions posted to their accounts. The intervention increased women's knowledge of account balances and trust in their local banking agent. Indicative of improved consumption-smoothing by income-constrained women, administrative data show that treated women accessed government transfers faster when the service was active, with treatment effects dissipating after the notifications were discontinued. On average, other aspects of account use remained unchanged. However, consistent with account information benefiting those with high transaction costs more, the intervention increased account use among women who lived more than an hour from the kiosk.
    JEL: G21 O12
    Date: 2022–07

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.