Local Autonomy, Tax Morale and the Shadow Economy

Arbeitspapier

Policymakers often propose strict enforcement strategies to fight the shadow economy and to increase tax morale. However, there is also a bottom-up approach such as, for example, decentralizing the political power to those who are close to the problems. Thus, this paper analyses the relationship between local autonomy and tax morale or the size of the shadow economy. We use data on tax morale at the individual level and macro data of the size of the shadow economy to systematically analyse the relevance of local autonomy and compliance in Switzerland, a country where the degree of federalism varies across different cantons. The findings suggest that there is a positive (negative) relationship between local autonomy and tax morale (size of the shadow economy).

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CREMA Working Paper ; No. 2008-24

Classification and Topics

• Classification: Wirtschaft ; Tax Evasion and Avoidance ; State and Local Government; Intergovernmental Relations: Interjurisdictional Differentials and Their Effects ; Analysis of Collective Decision-Making: General
• Subject: Tax Morale ; Shadow Economy ; Tax Compliance ; Tax Evasion ; Local Autonomy ; Federalism ; Institution

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Torgler, Benno ; Schneider, Friedrich ; Schaltegger, Christoph A.
• Event: Veröffentlichung
• (who): Center for Research in Economics, Management and the Arts (CREMA)
• (where): Basel
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/214418
• Last update: 10.03.2025, 11:41 AM CET