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Reference

Hepfer, B. F., Wilde, J. H., & Wilson, R. J. (2025). Nontax Use of Tax Havens: Evidence From Captive Insurance. Contemporary Accounting Research. https://doi.org/10.1111/1911-3846.70023

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Welcome to Revise and Resubmit! 🚀 The podcast where we dissect cutting-edge academic papers, revise our assumptions, and resubmit bolder ideas to the world. I'm your host, Mayukh, diving deep into the papers that shape economics, finance, and policy. Today? A bombshell from Contemporary Accounting Research – a prestigious FT50 journal! 🏆 Published by Wiley and the Canadian Academic Accounting Association, this gem dropped online December 9, 2025.

Picture this. Tax havens. 😈 Everyone screams "tax dodging!" Multinationals flock there, right? Headlines blast it. Policymakers rage. But wait. What if... some are there for zero tax perks? Short sentence. Punchy truth. Now breathe.

Authors Bradford F. Hepfer, Jaron H. Wilde, and Ryan J. Wilson drop the mic. 📈 Their paper, "Nontax Use of Tax Havens: Evidence From Captive Insurance," reveals the hidden game. Captive insurance subsidiaries. Firms "self-insure" in havens for risk management and regs. No federal tax goodies. Yet, 11% of nonfinancial firm-years use them across nearly all Fama-French 49 industries! 🌍

The rhythm builds. Conventional measures lump captives with shady income-shifting. Result? Tax savings look puny. Strip out captives... boom! Threefold jump in real haven tax grabs. 💥 They build a killer determinants model – high predictive power, out-of-sample wins – so future researchers can spot captives and nail true avoidance. Nuanced? Game-changing.

This FT50 powerhouse urges us: Rethink tax haven tropes. 10% of "haven users" are just insuring smartly. Policy? Media? Research? All need the fix.

Subscribe now to Revise and Resubmit on Spotify! 🎧 Hit up Weekend Researcher on YouTube! 📺 Catch us on Amazon Prime and Apple Podcasts too. Don't miss the revisions!

Thanks to authors Bradford F. Hepfer, Jaron H. Wilde, Ryan J. Wilson, Wiley, and the Canadian Academic Accounting Association for this FT50 gold. 🙏

So, here's the curious kicker: If tax havens hide more "self-insurance" than we thought, what other "nontax" secrets are multinationals burying there? 🤔