Nice guys finish last: Are people with higher tax morale taxed more heavily?

Arbeitspapier

This paper provides evidence of efficient taxation of groups with heterogeneous levels of tax morale. We set up an optimal income tax model where high tax morale implies a high subjective cost of evading taxes. The model predicts that nice guys finish last: groups with higher tax morale will be taxed more heavily, simply because taxing them is less costly. Based on unique cross-country micro data and an IV approach to rule out reverse causality, we find empirical support for this hypothesis. Income groups with high tax morale systematically face higher average and marginal tax rates. To the best of our knowledge, this is the first paper to investigate whether differences in tax morale affect the distribution of the tax burden across different groups of taxpayers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 3858

Classification and Topics

• Classification: Wirtschaft ; Taxation, Subsidies, and Revenue: General ; Fiscal Policies and Behavior of Economic Agents: General ; Analysis of Collective Decision-Making: General
• Subject: tax morale ; tax compliance ; optimal taxation ; political economy ; Steuermoral ; Steuerbelastung ; Optimale Besteuerung ; Public Choice ; Schätzung ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Philipp Doerrenberg ; Denvil Duncan ; Clemens Fuest ; Andreas Peichl
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/61001
• Last update: 10.03.2025, 11:41 AM CET