Purpose – The purpose of this study is to examine whether corporate tax avoidance behavior increases firm value in Chinese context. A large number of studies conduct their designs on the consumption that tax avoidance represents wealth transfer from government to enterprises and therefore enhances firm value. This study argues that, contrast to developed countries, tax avoidance does not necessarily add value to opaque Chinese firms relative to transparent counterparts due to higher agency costs. Design/methodology/approach – Using a large sample of Chinese listed-firms data for the period 2001-2009 and fixed effects regression model, this study examines the relation between tax avoidance and firm value. A series of robustness checks are conducted to alleviate the concern of endogeneity. Findings – The authors find that tax avoidance behavior increases agency costs and reduces firm value. The authors further find that information transparency interacts with corporate tax avoidance, moderating the relation between tax avoidance and firm value. Investors in China react negatively to corporate tax avoidance behavior, but this negative reaction could be mitigated by information transparency. The results are robust to a series of alternative treatments, including varied measures, first-order differential approach and 2SLS. Originality/value – The results suggest that tax avoidance does not necessarily increase firm value, part of gains are encroached by self-serving managers. Moreover, investors in China downplay the significance of tax avoidance, although corporate information transparency could soften their negative tone.

Dysplasia is a histologic precursor of esophageal squamous cell carcinoma (SCC). We previously showed that dietary freeze-dried, or lyophilized, strawberry powder inhibits N-nitrosomethylbenzylamine-induced SCC in the rat esophagus. On the basis of this observation, we conducted a randomized (noncomparative) phase II trial in China to investigate the effects of two doses of freeze-dried strawberries in patients with esophageal dysplastic lesions in a high-risk area for esophageal cancer. We randomly assigned 75 patients identified by endoscopy to have dysplastic esophageal premalignant lesions to receive freeze-dried strawberry powder at either 30 g/d (37 patients) or 60 g/d (38 patients) for six months; the powder was mixed with water and drunk. After six months, we assessed the changes in histologic grade of these lesions (primary endpoint) in a blinded fashion. The dose of 30 g/d, did not significantly affect histology or any other measured parameter. The dose of 60 g/d, however, reduced the histologic grade of dysplastic premalignant lesions in 29 (80.6%) of the 36 patients at this dose who were evaluated for histology (P < 0.0001). The strawberry powder was well tolerated, with no toxic effects or serious adverse events. Strawberries (60 g/d) also reduced protein expression levels of inducible nitric oxide synthase (iNOS) by 79.5% (P < 0.001), cyclooxygenase-2 (COX-2) by 62.9% (P < 0.001), phospho-nuclear factor kappa B (NFκB)-p65 (pNFκB-p65) by 62.6% (P < 0.001), and phospho-S6 (pS6) by 73.2% (P < 0.001). Freeze-dried strawberries (60 g/d) also significantly inhibited the Ki-67 labeling index by 37.9% (P = 0.023). Our present results indicate the potential of freeze-dried strawberry powder for preventing human esophageal cancer, supporting further clinical testing of this natural agent in this setting.