IDEAS home Printed from https://ideas.repec.org/a/mve/journl/v32y2006i2p45-59.html
   My bibliography  Save this article

Audit Lags and Taxpayer Compliance: A Simple Intertemporal Model

Author

Listed:
  • Joseph G. Eisenhauer

    (Canisius College)

Abstract

Conventional analyses of taxpayer behavior predict that individuals will fulfill their tax obligations completely if and only if the expected net gain from tax evasion is zero or negative. In practice, however, taxpayers commonly pay their full taxes despite what appears to be a strong financial incentive for noncompliance. A simple intertemporal model based on audit lags helps to resolve the discrepancy between theory and practice by showing that full compliance may indeed be utility maximizing despite the expectation of positive net gains from evasion, depending upon the taxpayer’s future income, propensity for saving, and degree of risk aversion.

Suggested Citation

  • Joseph G. Eisenhauer, 2006. "Audit Lags and Taxpayer Compliance: A Simple Intertemporal Model," Journal of Economic Insight, Missouri Valley Economic Association, vol. 32(2), pages 45-59.
    • Handle: RePEc:mve:journl:v:32:y:2006:i:2:p:45-59
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Muehlbacher, Stephan & Mittone, Luigi & Kastlunger, Barbara & Kirchler, Erich, 2012. "Uncertainty resolution in tax experiments: Why waiting for an audit increases compliance," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(3), pages 289-291.

    More about this item

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mve:journl:v:32:y:2006:i:2:p:45-59. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ken Brown (email available below). General contact details of provider: https://edirc.repec.org/data/mveaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.