Transfer Pricing and Corporate Taxation: Problems, Practical Implications and Proposed Solutions

National tax authorities individually determine multinational—rms’ country-specific tax liabilities by applying one or more sanctioned transfer pricing methodologies. These methodologies are founded on basic assumptions about market structure and—rm behavior that are rarely empirically valid. Moreover, for the most part, the transfer pricing methodologies now in vogue were developed before the Internet became a dominant factor in the world economy, and hedge and private equity funds transfo...