Harris, Jeremiah and William O'Brien, 2025, U.S. Multinationals’ Alternatives to Paying Taxes. Journal of Corporate Finance, 91. (Online Appendix)
Harris, Jeremiah and William O'Brien, 2022, Do U.S. Firms Disguise Acquisitions to Avoid Taxes? Financial Review, 57: 95-127. (Online Appendix)
Austin, Josh, Jeremiah Harris, and William O'Brien, 2020, Do the Most Prominent Firms Really Make the Worst Deals? How Selection Issues Affect Inferences from M&A Studies, Journal of Banking and Finance, 118. (Online Appendix)
Harris, Jeremiah and William O'Brien, 2018, U.S. Worldwide Taxation and Domestic Mergers and Acquisitions, Journal of Accounting and Economics, 66: 419-438. (Online Appendix)
Harris, Jeremiah and Ralph Siebert, 2017, Firm-Specific Time Preferences and Postmerger Firm Performance, International Journal of Industrial Organization, 53: 32-62.
U.S. Multinationals' Tax Strategies and Domestic Employment
(with William O'Brien) We investigate the effect of foreign tax avoidance (and the subsequent increase in potential repatriation taxes) on domestic (U.S.) employment for multinational corporations. We use confidential BEA data on foreign and domestic employment during both the pre-TCJA and post-TCJA years. Using the establishment of a Double Irish tax avoidance structure and a proxy for exogeneous changes to potential repatriation taxes, we provide plausibly-causal evidence that potential repatriation taxes decreased domestic employment while increasing foreign employment during the pre-TCJA era. Despite removing repatriation taxes, we find no evidence that the TCJA changed employment behavior; firms continued with business as usual.
Project accepted in 2022 by the Bureau of Economic Analysis as part of their Special Sworn Researcher Program
Investing in AI: Clinical Trial Efficiency and Market Reaction
(with Sean Cao and Lijun (Gillian) Lei) While artificial intelligence (AI) is heralded as a panacea, we still grapple with the optimal ways to harness its potential. Using project-level clinical trial data, we find that pharmaceutical firms’ AI investment, on average, does not improve trial efficiency or financial prospects. We identify the contexts where AI adds value and when it does not. Overall, complementary human expertise, balanced regulation, and optimization objective clarity are critical for realizing AI’s potential. When these factors come together, AI can improve efficiency and financial prospects of clinical trials, which in turn enhances social welfare. Our analysis addresses an emerging question: not whether firms should adopt AI, but how they can do so effectively. (Online Appendix)
Earlier versions of this paper were circulated under the title “When Does AI Deliver Value? Evidence From Clinical Trials.”
Investor Attention Around Corporate Restructurings
(with Jonathan Kalodimos and William O'Brien) We investigate investor behavior and firm performance related to corporate restructuring announcements using a database of Security Exchange Commission (SEC) filings by U.S. firms and web traffic on the SEC’s website. We find that abnormal investor attention positively predicts restructuring announcements for up to three months prior to the announcement and attention stays elevated for at least twelve months afterwards. This is true for the attention of both retail investors and mutual funds. We also find that abnormal attention from both retail investors and mutual funds prior to a restructuring announcement is positively related to long-run abnormal returns to the firm, suggesting that some retail investors exhibit a high degree of sophistication and are not simply noise traders. Our results are consistent with investors focusing their limited attention on restructuring plans with the highest probability of restructuring success.
Adapting Innovation When Facing Economic Uncertainty
(with Dandan Liu and Xiaoling Pu) It is well known that innovation generally declines when faced with uncertainty; this study extends the literature by documenting heterogeneity in how firms adapt their innovation activities when facing aggregate economic uncertainty. We show that firms’ responses are related to both internal factors such as patent types, asset redeployability, patent assignments, and financial constraints, as well as external factors such as ownership by myopic investors. The negative relationship with uncertainty is exaggerated by financial constraints and mitigated by redeployability while the detrimental effects of myopic investors on innovation are greatly dampened during periods of high aggregate economic uncertainty.
8-K Filings and the Investor Divide: How Speed and Technology Shape Institutional and Retail Performance (with Stephen Owen)
This research project aims to examine the immediate price movement associated with SEC 8-K announcements using a large sample of over 800,000 non-earnings-related 8-K filings combined with tick-level pricing data. Our primary research question addresses whether institutional investors quickly infer the value implications of these 8-K announcements and execute advantageous trades before retail investors can respond results in a performance gap. Using the COVID-19 pandemic as a shock to retail investor participation and using the advent of ChatGPT as a shock to retail investors technological resources, we hypothesize that the first shock will increase the performance gap between retail and institutional investors while the second shock will decrease the gap.
Presented at the 2024 Financial Management Association New Ideas Session
Recipient of the 2025 Dean's Distinguished Scholar Award in the Ambassador Crawford College of Business and Entrepreneurship
The Impact of Acquisitions on Local Business Activity (with Shawn Rohlin and Richard Thakor)
We combine establishment-level InfoGroup data with SDC M&A events to show the impact of an acquisition on local business activity. To overcome endogeneity concerns, we use withdrawn acquisitions (acquisitions that were announced but not completed) to provide a baseline for comparison with the treated areas where mergers are completed.
Do Patent Assignments Facilitate Tax-Motivated Profit Shifting?
In this project, I use a novel dataset from the USPTO that captures patent assignments (the transfer of ownership to another entity). If firms are using patent assignments for profit shifting to low tax jurisdictions, we would expect to see a decline in effective tax rates after the assignment of patents to entities in low-tax countries.
Information Discovery in Consecutive Cross-Border Mergers
I find evidence that announcement day returns to second mergers are greater that the first mergers for consecutive cross-border mergers, contrasting consecutive domestic (U.S.) mergers where returns significantly decline from the first to the second merger. This paper suggests that the increasing returns can be explained by information discovered by investors about the quality of the first merger upon announcement of the second merger. Using heterogeneity in various measures of uncertainty regarding the first merger, I find the increasing returns are concentrated in consecutive mergers where the level of uncertainty about the first merger is the greatest.
Determinants and Consequences of Reactive Divestitures
(with Vusal Eminli, last revised August 2018) This study shows that firms react to market and investor pressure by divesting subsidiaries. We find that these divestitures tend to follow negative earnings announcements and are associated with firms most likely to be facing financial difficulties. Consistent with firms reacting to increasing pressure to improve performance, the relationship between negative earnings announcements is strengthened when the firm has repeated negative earnings. Further pressure is applied to the firms by transient institutional investors focused on short-term strategies. When a firm reacts to pressure resulting from negative earnings and divests, the firm’s market value and Tobin’s Q increase.