Arbeitspapier
Framing and loss aversion in tax reporting behavior: Evidence from German income tax return data
This paper investigates the presence of framing effects and loss aversion in tax reporting behavior of wage earners using a balanced panel of German income tax return data. Reference dependence and loss aversion suggest that individuals in a perceived loss situation attribute higher value to a given amount of positive change in outcome than individuals in a perceived gain situation do. Applied to tax reporting behavior, taxpayers who perceive their tax situation as unfavorable compared to a given reference point are expected to make greater effort or accept higher costs to prevent or reduce that perceived loss than taxpayers perceiving themselves to be in a favorable situation. Greater effort can in turn be associated with higher reporting aggressiveness. We identify a potential reference point in taxpayers' previous year's outcome and examine whether taxpayers claim higher additional tax deductions in a loss situation than in a gain situation. We use a difference-in-difference approach with a one-on-one matching strategy to analyze reporting behavior. We find that taxpayers in a loss situation claim higher income-related deductions than taxpayers in a gain situation.
- Sprache
-
Englisch
- Erschienen in
-
Series: Passauer Diskussionspapiere - Betriebswirtschaftliche Reihe ; No. B-43-20
- Klassifikation
-
Management
Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
Tax Evasion and Avoidance
- Thema
-
loss aversion
framing
tax avoidance
nonbusiness tax
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Diller, Markus
Kühne, Daniela
- Ereignis
-
Veröffentlichung
- (wer)
-
Universität Passau, Wirtschaftswissenschaftliche Fakultät
- (wo)
-
Passau
- (wann)
-
2020
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Diller, Markus
- Kühne, Daniela
- Universität Passau, Wirtschaftswissenschaftliche Fakultät
Entstanden
- 2020
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