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Compliance Behavior in Networks: Evidence from a Field Experiment

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  • Francesco Drago
  • Friederike Mengel
  • Christian Traxler

Abstract

This paper studies the spread of compliance behavior in neighborhood networks in Austria. We exploit a field experiment that varied the content of mailings sent to potential evaders of TV license fees. The data reveal a strong treatment spillover: untreated households are more likely to switch from evasion to compliance in response to mailings received by their network neighbors. Digging deeper into the properties of the spillover, we find that it is concentrated among close neighbors of the targets and increases with the treated households' diffusion centrality. Local concentration of equally treated households implies a lower spillover.

Suggested Citation

  • Francesco Drago & Friederike Mengel & Christian Traxler, 2020. "Compliance Behavior in Networks: Evidence from a Field Experiment," American Economic Journal: Applied Economics, American Economic Association, vol. 12(2), pages 96-133, April.
  • Handle: RePEc:aea:aejapp:v:12:y:2020:i:2:p:96-133
    DOI: 10.1257/app.20170690
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    Cited by:

    1. Castro, Juan Francisco & Velásquez, Daniel & Beltrán, Arlette & Yamada, Gustavo, 2020. "Spillovers and Long-Run Effects of Messages on Tax Compliance: Experimental Evidence from Peru," IZA Discussion Papers 13974, Institute of Labor Economics (IZA).
    2. Garz, Marcel & Pagels, Verena, 2018. "Cautionary tales: Celebrities, the news media, and participation in tax amnesties," Journal of Economic Behavior & Organization, Elsevier, vol. 155(C), pages 288-300.
    3. Philipp Doerrenberg & Andreas Peichl, 2020. "Tax Morale and the Role of Social Norms and Reciprocity - Evidence from a Randomized Survey Experiment," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 0, pages 1-43.
    4. Wolfgang Frimmel & Martin Halla & Jörg Paetzold, 2019. "The Intergenerational Causal Effect of Tax Evasion: Evidence from the Commuter Tax Allowance in Austria," Journal of the European Economic Association, European Economic Association, vol. 17(6), pages 1843-1880.
    5. Mascagni, Giulia, 2017. "From the Lab to the Field: A Review of Tax Experiments," Working Papers 13726, Institute of Development Studies, International Centre for Tax and Development.
    6. Liza Charroin, 2018. "Homophily, peer effects and dishonesty," Post-Print halshs-01993618, HAL.
    7. Di Gioacchino, Debora & Fichera, Domenico, 2020. "Tax evasion and tax morale: A social network analysis," European Journal of Political Economy, Elsevier, vol. 65(C).
    8. Adena, Maja & Hager, Anselm, 2020. "Does online fundraising increase charitable giving? A nation-wide field experiment on Facebook," Discussion Papers, Research Unit: Economics of Change SP II 2020-302, WZB Berlin Social Science Center.
    9. Boning, William C. & Guyton, John & Hodge, Ronald & Slemrod, Joel, 2020. "Heard it through the grapevine: The direct and network effects of a tax enforcement field experiment on firms," Journal of Public Economics, Elsevier, vol. 190(C).
    10. Riedel, Nadine & Strohmaier, Kristina & Lediga, Collen, 2019. "Spatial Tax Enforcement Spillovers: Evidence from South Africa," VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy 203500, Verein für Socialpolitik / German Economic Association.
    11. Brollo, Fernanda & Kaufmann, Katja Maria & Ferrara, Eliana La, 2017. "Learning about the Enforcement of Conditional Welfare Programs: Evidence from Brazil," CAGE Online Working Paper Series 317, Competitive Advantage in the Global Economy (CAGE).
    12. Giulia Mascagni, 2018. "From The Lab To The Field: A Review Of Tax Experiments," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 273-301, April.
    13. Perez-Truglia, Ricardo & Troiano, Ugo, 2018. "Shaming tax delinquents," Journal of Public Economics, Elsevier, vol. 167(C), pages 120-137.
    14. Essi Eerola & Tuomas Kosonen & Kaisa Kotakorpi & Teemu Lyytikäinen, 2019. "Tax Compliance in the RentalHousing Market: Evidence from aField Experiment," Discussion Papers 126, Aboa Centre for Economics.
    15. Carrillo, Paul E. & Castro, Edgar & Scartascini, Carlos, 2021. "Public good provision and property tax compliance: Evidence from a natural experiment," Journal of Public Economics, Elsevier, vol. 198(C).
    16. Blesse, Sebastian, 2021. "Are your tax problems an opportunity not to pay taxes? Evidence from a randomized survey experiment," ZEW Discussion Papers 21-040, ZEW - Leibniz Centre for European Economic Research.
    17. Bastani, Spencer & Giebe, Thomas & Miao, Chizheng, 2020. "Ethnicity and tax filing behavior," Journal of Urban Economics, Elsevier, vol. 116(C).
    18. Paul Carrillo & Edgar Castro & Carlos Scartascini, 2017. "Do Rewards Work?: Evidence from the Randomization of Public Works," IDB Publications (Working Papers) 98459, Inter-American Development Bank.
    19. Lopez-Luzuriaga, Andrea & Scartascini, Carlos, 2019. "Compliance spillovers across taxes: The role of penalties and detection," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 518-534.
    20. Meiselman, Ben S., 2018. "Ghostbusting in Detroit: Evidence on nonfilers from a controlled field experiment," Journal of Public Economics, Elsevier, vol. 158(C), pages 180-193.
    21. Dina Pomeranz & José Vila-Belda, 2019. "Taking State-Capacity Research to the Field: Insights from Collaborations with Tax Authorities," Annual Review of Economics, Annual Reviews, vol. 11(1), pages 755-781, August.
    22. Rodrigo Ceni & Gonzalo Salas, 2019. "Transfer Program Enforcement and Children's Time Allocation," Documentos de Trabajo (working papers) 19-17, Instituto de Economia - IECON.

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    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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