Taxes as a Determinant of Managerial Compensation in Privately Held Insurance Companies
研究1989-1996年间管理层持股的私营保险公司如何根据税率变化调整薪酬与投资收入的比例，发现个人所得税率相对公司税率上升时，管理者会减少可抵税薪酬。
This study empirically investigates how taxes affect managerial compensation for a sample of privately held insurers whose managers own a large percentage of the firm's stock (I refer to these as management-owned insurers) during 1989–1996. Shareholder/managers receive two types of income from the firm they own: compensation income as employees, and investment income as shareholders. Although compensation income is taxable to employees and deductible by employers, investment income is subject to double taxation. Thus, the mix of the two is an important tax-planning decision for management-owned insurers. I predict and find that as individual tax rates increased relative to corporate tax rates from 1989–1992 to 1993–1996, shareholder/managers paid themselves less tax-deductible compensation relative to a control sample of nonmanagement-owned insurers (i.e., privately held insurers with no managerial ownership). The study's results expand our understanding of management-owned, privately held firms' tax-planning strategies, and have implications for the efficiency of the federal income tax system.