Audit Lags and Taxpayer Compliance: A Simple Intertemporal Model
AbstractConventional 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.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" 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.
Bibliographic InfoArticle provided by Missouri Valley Economic Association in its journal The Journal of Economics.
Volume (Year): 32 (2006)
Issue (Month): 2 ()
Find related papers by JEL classification:
- H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Muehlbacher, Stephan & Mittone, Luigi & Kastlunger, Barbara & Kirchler, Erich, 2012. "Uncertainty resolution in tax experiments: Why waiting for an audit increases compliance," The Journal of Socio-Economics, Elsevier, vol. 41(3), pages 289-291.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ken Brown).
If references are entirely missing, you can add them using this form.