Who benefits from commodity price shocks? This paper studies the geographic allocation of extractive MNEs profits generated by price shocks - usually called windfall profits. We combine new administrative data on the worldwide activity of MNEs with exhaustive oil, gas, and mining production data at the firm level. We identify the allocation of windfall profits by leveraging differences in (i) the product specialization of extractive firms and (ii) commodity price changes, in a shift-share design. We provide evidence of overbooking of windfall profits in low-tax countries.  For $1 increase in consolidated windfall profits, we observe a $0.2 increase in tax havens, $0.8 in extractive affiliates, and no increase in the rest of the group. We further find that the share of tax havens in total profits increases following a price shock.

This paper quantifies how profit shifting erodes workers' earnings by reducing profit-sharing payouts in French multinational firms. We leverage newly available administrative microdata on the global activity of multinational firms linked to employer-employee data to build a credible counterfactual of profits and profit-sharing absent profit shifting. We estimate that large French multinationals shift 19% of their foreign profits annually to low-tax jurisdictions, resulting in €10.3 billion shifted out of France and €3.7 billion in lost tax revenues. We show that profit shifting reduces annual employees' earnings by 2.6%. Low-income workers are disproportionately affected. The bottom 10% of workers lose 3.2% of wages, compared to 2.3% for top 10% earners. Changing the profit-sharing formula to account for global profitability, rather than subsidiary-level profitability, would increase wages by 4.1% for workers in profit-shifting subsidiaries.

Taxation and Cross-Border Intellectual Property Licensing,  with Laurie Ciaramella and Arthur Guillouzouic