Government tax regulations have an important impact on the behaviour of firms. They influence firms’ capital structure and investment decisions, transfer pricing policies, mergers and acquisitions, and much more. Despite much research over the past decades, there still remain gaps in our knowledge of the effects of taxation on firm behaviour. Improving this knowledge is highly relevant, especially because governments try to motivate firms to certain desired behaviour by ways of different tax regulations. In this dissertation, I contribute to improving this knowledge by investigating several effects of two specific tax regulations that are socially relevant. The first is the effect of the ability to compensate past losses with taxable income in future periods in order to lower tax payments in these future periods. This tax treatment of losses is used by governments for instance to stimulate investments in times of economic crises. The second is the effect of double tax treaties, which are used to attract foreign investments, but that could also facilitate tax evasion. In Chapter 2, I start by improving the available data surrounding tax loss carryforwards (TLCFs). TLCFs are the result of governments’ tax treatment of losses. Data on TLCFs are frequently missing in a popular research database and researchers often assume that missing values are zeros. Chapter 2 shows that this assumption introduces substantial measurement error, and presents and validates an algorithm that estimates missing observations instead of replacing them by zeros. These estimations significantly reduce measurement error in estimations that use TLCF values, which creates opportunities for further evaluation of the effects of TLCFs on firm behaviour. Chapter 3 takes these improved data and analyses whether TLCFs are associated with more investments. As TLCFs shield income from taxation, more TLCFs should be associated with more investments. We validate this hypothesis with simulation analyses as well as empirical estimations. We show economically significant effects of this tax variable on firm investments that differ importantly for different types and characteristics of these investments as well as between different kinds of firms. In Chapter 4, I analyse the role of bilateral tax treaties in cross-border profit shifting. Tax treaties are contractual terms between national tax regulators to reduce double taxation risks and to combat tax evasion. In that chapter, I argue that tax treaties may indeed reduce profit shifting, but that low regulatory enforcement may actually cause treaties to increase profit shifting. Consistent with this, I present results that suggest that treaties increase profit shifting when enforcement is low, but decrease shifting when enforcement is high. Overall, the insights in this dissertation may inform policymakers about the effectiveness of tax policies and tax enforcement in providing the desired incentives with respect to firm behaviour.