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Tax me if you can: An artifactual field experiment on dishonesty

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  • Jacobsen, Catrine
  • Piovesan, Marco

Abstract

In this paper, we test whether increased salience of a tax charge increases dishonesty using a version of the die-under-cup paradigm. Participants earn money in proportion to the outcome reported and, thus, have an incentive to over-report. We find a significant increase in high outcomes in the presence of a tax frame suggesting that participants use the tax as an excuse to rationalize their dishonest act. In addition, we tested whether adding an explanation for the adoption of the tax would increase honesty. We find evidence for reversed dishonesty with participants reporting significantly more low outcomes. These results warn policy makers about the non-trivial relationship between taxation charges and dishonesty.

Suggested Citation

  • Jacobsen, Catrine & Piovesan, Marco, 2016. "Tax me if you can: An artifactual field experiment on dishonesty," Journal of Economic Behavior & Organization, Elsevier, vol. 124(C), pages 7-14.
  • Handle: RePEc:eee:jeborg:v:124:y:2016:i:c:p:7-14
    DOI: 10.1016/j.jebo.2015.09.009
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    Citations

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    Cited by:

    1. Christoph Engel, 2016. "Experimental Criminal Law. A Survey of Contributions from Law, Economics and Criminology," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2016_07, Max Planck Institute for Research on Collective Goods.
    2. Johannes Abeler & Daniele Nosenzo & Collin Raymond, 2019. "Preferences for Truth‐Telling," Econometrica, Econometric Society, vol. 87(4), pages 1115-1153, July.
    3. Ellen Garbarino & Robert Slonim & Marie Claire Villeval, 2018. "A method to estimate mean lying rates and their full distribution," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 4(2), pages 136-150, December.
    4. Garbarino, Ellen & Slonim, Robert & Villeval, Marie Claire, 2016. "Loss Aversion and Lying Behavior: Theory, Estimation and Empirical Evidence," IZA Discussion Papers 10395, Institute of Labor Economics (IZA).
    5. Catrine Jacobsen & Toke Reinholt Fosgaard & David Pascual†Ezama, 2018. "Why Do We Lie? A Practical Guide To The Dishonesty Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 357-387, April.
    6. Ellen Garbarino & Robert Slonim & Marie Claire Villeval, 2019. "Loss aversion and lying behavior," Post-Print halshs-01981542, HAL.
    7. Ellen Garbarino & Robert Slonim & Marie Claire Villeval, 2018. "A Method to Estimate Mean Lying Rates and Their Full Distribution," Post-Print halshs-01896598, HAL.
    8. Gilles Grolleau & Martin G. Kocher & Angela Sutan, 2016. "Cheating and Loss Aversion: Do People Cheat More to Avoid a Loss?," Management Science, INFORMS, vol. 62(12), pages 3428-3438, December.
    9. Gilles Grolleau & Martin G. Kocher & Angela Sutan, 2014. "Cheating and Loss Aversion: Do People Lie More to Avoid a Loss?," CESifo Working Paper Series 4965, CESifo.
    10. Drupp, Moritz A. & Khadjavi, Menusch & Quaas, Martin F., 2019. "Truth-telling and the regulator. Experimental evidence from commercial fishermen," European Economic Review, Elsevier, vol. 120(C).
    11. Ayal, Shahar & Celse, Jérémy & Hochman, Guy, 2021. "Crafting messages to fight dishonesty: A field investigation of the effects of social norms and watching eye cues on fare evasion," Organizational Behavior and Human Decision Processes, Elsevier, vol. 166(C), pages 9-19.
    12. Garbarino, Ellen & Slonim, Robert & Villeval, Marie Claire, 2019. "Loss aversion and lying behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 158(C), pages 379-393.
    13. Drupp, Moritz A. & Khadjavi, Menusch & Quaas, Martin F., 2016. "Truth-telling and the regulator: Evidence from a field experiment with commercial fishermen," Kiel Working Papers 2063, Kiel Institute for the World Economy (IfW Kiel).
    14. Innes, Robert, 2022. "Does deception raise or lower lie aversion? Experimental evidence," Journal of Economic Psychology, Elsevier, vol. 90(C).

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    More about this item

    Keywords

    Tax evasion; Dishonesty; Framing; Rationalization;
    All these keywords.

    JEL classification:

    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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