Tax compliance and obedience to authority at home and in the lab: A new experimental approach

  title={Tax compliance and obedience to authority at home and in the lab: A new experimental approach},
  author={C. Bram Cadsby and Elizabeth Maynes and Viswanath Umashanker Trivedi},
  journal={Experimental Economics},
In most experimental studies of tax evasion, participants are instructed that they may report any amount of income from zero up to the amount they actually earned or received. This amounts to an invitation to gamble. In contrast, real-world tax authorities unambiguously demand compliance. We develop two new settings for conducting tax experiments. Both involve an explicit demand for compliance. Thus, we can determine whether knowing that the experimental authority would regard evasion as… 
Behavioral dynamics of tax compliance when taxpayer assistance services are available
This research utilizes a laboratory experiment involving a large and diverse set of participants to investigate the behavioral dynamics of tax reporting in a setting where tax liability is uncertain
40 years of tax evasion games: a meta-analysis
We collect individual participant data from 70 papers that use laboratory experiments to examine individual tax evasion behavior (or "Tax Evasion Games"), in order to use meta-analysis to estimate
Investigating Behavioral Responses to Positive Inducements for Filing Tax Returns
A significant amount of non-compliance associated with the personal income tax is due to the taxpayers who are not “in the system,” not having filed a tax return in the recent past or perhaps ever.
The Effect of Prescriptive Norms and Negative Externalities on Bribery Decisions
Corruption is a welfare issue worldwide, but it is difficult to study because of its secret nature. We here did a lab economic experiment on bribery to study different compliance mechanisms through
Essays on Individual Choice and Behavior
This dissertation consists of three chapters that explore individual choice and behavior. Chapter 1 investigates the incentive properties of advisory referenda using a particular form of non-expected
A practical guide to setting up your Tax Evasion Game
Over the last four decades, an important stream of literature has studied tax compliance behaviour in the laboratory through tax evasion games. In this review of over 70 papers, the main results are
The Impact of Tax Compliance Costs On Tax Compliance Behaviour
This paper is based on a study that determined whether or not an increase in income tax compliance costs leads to a decrease in income tax compliance. The tax context experiment involved 75 small and
Obeying vs. resisting unfair laws. A structural analysis of the internalization of collective preferences on redistribution using classification trees and random forests
In this paper, we study whether individual normative preferences are affected by the knowledge of collective normative preferences. In a questionnaire-experimental framework, we study whether


Experimental Evidence on the Relation between Tax Rates and Compliance: The Effect of Earned vs. Endowed Income
In this paper, we report the results of an experiment designed to determine whether the manner in which income is obtained (earned vs. endowed) affects the relation between tax rates and taxpayer
Tax Evasion and Voting: An Experimental Analysis
The puzzle of tax compliance is why people pay taxes instead of evading them: given the low expected fines, rational taxpayers should decide to underreport taxable income. However, most taxpayers
Reward Dominance in Tax‐Reporting Experiments: The Role of Context
During the past decade, the experimental economics method increasingly has been used to study the impact of tax policy on taxpayer behavior. Experimental economics in taxation typically tests tax
Tax Evasion on the Micro: Significant Simulations or Expedient Experiments?
In recent years various aspects of tax evasion (the effects of tax rates, audit probability and equity) have been investigated using simulation techniques. This paper reports a series of experiments
Duty, Fear, and Tax Compliance: The Heuristic Basis of Citizenship Behavior
Theory: The costs imposed by income tax and other citizenship duties provide powerful incentives to free ride, yet the likelihood of getting caught-the primary self-interested deterrent to
Economic and Noneconomic Factors in Tax Compliance
This paper uses experimental methods to explore the major factors that affect tax compliance. Perhaps most importantly, the role of social norms in compliance is examined by comparing compliance
The fundamental difficulty in empirical work on taxpayer compliance is the absence of detailed and reliable information on individual compliance choices. This paper uses data from laboratory
Procrastination and Obedience
In this lecture I shall focus on situations involving repeated decisions with time inconsistent behavior. Although each choice may be close to maximizing and therefore result in only small losses,
Entitlements, Rights, and Fairness: An Experimental Examination of Subjects' Concepts of Distributive Justice
THE research reported in this paper arose from a previous experimental study conducted by the authors.' That study involved bargains struck between two subjects who had opposing payoff functions and