The Origins of Social Contracts: Attitudes toward Taxation in Urban Nigeria
AbstractHow do social contracts come into being?� This paper argues that norm adoption plays an important and neglected role in this process.� Using novel data from urban Nigeria, we examine why individuals adopt norms favoring a citizen obligation to pay tax where state enforcement is weak.� We find that public goods delivery by the state produces the willingness to pay tax, but community characteristics also have a strong and independent effect on both social contract norms and actual tax payment.� Individuals are less likely to adopt pro-tax norms if they have access to community provision of security and other services.� In conflict-prone communities, where "self-help" provision of club goods is less effective, individuals are more likely to adopt social contract norms.� Finally, we show that social contract norms substantially boost tax payment.� This paper has broad implications for literatures on state formation, taxation, clientelism, and public goods provision.
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Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number WPS/2013-02.
Date of creation: 24 Jan 2013
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-AFR-2013-03-09 (Africa)
- NEP-ALL-2013-03-09 (All new papers)
- NEP-CDM-2013-03-09 (Collective Decision-Making)
- NEP-DEV-2013-03-09 (Development)
- NEP-EVO-2013-03-09 (Evolutionary Economics)
- NEP-IUE-2013-03-09 (Informal & Underground Economics)
- NEP-PBE-2013-03-09 (Public Economics)
- NEP-SOC-2013-03-09 (Social Norms & Social Capital)
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