IDEAS home Printed from https://ideas.repec.org/a/mhr/finarc/urnsici0015-2218(201403)701_3poctet_2.0.tx_2-w.html
   My bibliography  Save this article

Persistence or Convergence? The East-West Tax-Morale Gap in Germany

Author

Listed:
  • Axel Möhlmann

Abstract

This paper studies differences in tax-morale attitudes between East and West Germany using multiple recent data sets. Contrary to previous 1990s evidence, but in line with recent studies on an east-west mentality gap, we find a persistent higher tax morale in East Germany and no indication of convergence over time. Distinguishing between region of living and birth reveals that East Germans who stayed determine the results and that migration reduces differences. Regional economic heterogeneity cannot explain the results, whereas historical patterns of religious denomination absorb part of the effect. An effect of question phrasing illustrates underlying moral reasoning.

Suggested Citation

  • Axel Möhlmann, 2014. "Persistence or Convergence? The East-West Tax-Morale Gap in Germany," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 70(1), pages 3-30, March.
    • Handle: RePEc:mhr:finarc:urn:sici:0015-2218(201403)70:1_3:poctet_2.0.tx_2-w
    DOI: 10.1628/001522108X679138
    as

    Download full text from publisher

    File URL: https://www.mohrsiebeck.com/en/article/persistence-or-convergence-the-east-west-tax-morale-gap-in-germany-101628001522114x679138
    Download Restriction: Fulltext access is included for subscribers to the printed version.
    File URL: https://libkey.io/10.1628/001522108X679138?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Sascha O. Becker & Ludger Woessmann, 2009. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 531-596.
    2. Stephen J. Redding & Daniel M. Sturm, 2008. "The Costs of Remoteness: Evidence from German Division and Reunification," American Economic Review, American Economic Association, vol. 98(5), pages 1766-1797, December.
    3. Gabriel M. Ahlfeldt & Stephen J. Redding & Daniel M. Sturm & Nikolaus Wolf, 2015. "The Economics of Density: Evidence From the Berlin Wall," Econometrica, Econometric Society, vol. 83, pages 2127-2189, November.
    4. Halla Martin, 2012. "Tax Morale and Compliance Behavior: First Evidence on a Causal Link," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 12(1), pages 1-27, April.
    5. Heineck, Guido & Süssmuth, Bernd, 2013. "A different look at Lenin’s legacy: Social capital and risk taking in the Two Germanies," Journal of Comparative Economics, Elsevier, vol. 41(3), pages 789-803.
    6. Sijbren Cnossen & Hans-Werner Sinn (ed.), 2003. "Public Finance and Public Policy in the New Century," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262033046, December.
    7. Kai A. Konrad & Salmai Qari, 2012. "The Last Refuge of a Scoundrel? Patriotism and Tax Compliance," Economica, London School of Economics and Political Science, vol. 79(315), pages 516-533, July.
    8. Friedrich Heinemann, 2011. "Economic crisis and morale," European Journal of Law and Economics, Springer, vol. 32(1), pages 35-49, August.
    9. Davide Cantoni, 2015. "The Economic Effects Of The Protestant Reformation: Testing The Weber Hypothesis In The German Lands," Journal of the European Economic Association, European Economic Association, vol. 13(4), pages 561-598, August.
    10. Alberto Alesina & Nicola Fuchs-Schundeln, 2005. "Good bye Lenin (or not?): The effect of Communism on people's preferences," Harvard Institute of Economic Research Working Papers 2076, Harvard - Institute of Economic Research.
    11. Torgler, Benno & Schneider, Friedrich, 2009. "The impact of tax morale and institutional quality on the shadow economy," Journal of Economic Psychology, Elsevier, vol. 30(2), pages 228-245, April.
    12. Philipp Doerrenberg & Andreas Peichl, 2013. "Progressive taxation and tax morale," Public Choice, Springer, vol. 155(3), pages 293-316, June.
    13. Jennifer Hunt, 2006. "Staunching Emigration from East Germany: Age and the Determinants of Migration," Journal of the European Economic Association, MIT Press, vol. 4(5), pages 1014-1037, September.
    14. Alm, James & Torgler, Benno, 2006. "Culture differences and tax morale in the United States and in Europe," Journal of Economic Psychology, Elsevier, vol. 27(2), pages 224-246, April.
    15. Joel Slemrod, 2010. "Old George Orwell Got It Backward: Some Thoughts on Behavioral Tax Economics," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 66(1), pages 15-33, March.
    16. Wolf, Nikolaus, 2009. "Was Germany Ever United? Evidence from Intra- and International Trade, 1885–1933," The Journal of Economic History, Cambridge University Press, vol. 69(3), pages 846-881, September.
    17. Stefan Bauernschuster & Helmut Rainer, 2012. "Political regimes and the family: how sex-role attitudes continue to differ in reunified Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(1), pages 5-27, January.
    18. Torgler, Benno, 2006. "The importance of faith: Tax morale and religiosity," Journal of Economic Behavior & Organization, Elsevier, vol. 61(1), pages 81-109, September.
    19. Friedrich Heinemann, 2008. "Is the Welfare State Self‐Destructive? A Study of Government Benefit Morale," Kyklos, Wiley Blackwell, vol. 61(2), pages 237-257, May.
    20. Werner Güth & Vittoria Levati & Rupert Sausgruber, 2005. "Tax morale and (de-)centralization: An experimental study," Public Choice, Springer, vol. 125(1), pages 171-188, July.
    21. Sinn, Hans-Werner, 2002. "Germany's Economic Unification: An Assessment after Ten Years," Review of International Economics, Wiley Blackwell, vol. 10(1), pages 113-128, February.
    22. Konrad, Kai A. & Qari, Salmai, 2012. "The Last Refuge of a Scoundrel?," Munich Reprints in Economics 13960, University of Munich, Department of Economics.
    23. Elaine Doyle & Jane Frecknall Hughes & Barbara Summers, 2013. "An Empirical Analysis of the Ethical Reasoning of Tax Practitioners," Journal of Business Ethics, Springer, vol. 114(2), pages 325-339, May.
    24. Lars P. Feld & Benno Torgler & Bin Dong, 2008. "Coming Closer? Tax Morale, Deterrence and Social Learning after German Unification," CREMA Working Paper Series 2008-09, Center for Research in Economics, Management and the Arts (CREMA).
    25. Alm, James & Jackson, Betty R. & McKee, Michael, 1993. "Fiscal exchange, collective decision institutions, and tax compliance," Journal of Economic Behavior & Organization, Elsevier, vol. 22(3), pages 285-303, December.
    26. Lago-Peñas, Ignacio & Lago-Peñas, Santiago, 2010. "The determinants of tax morale in comparative perspective: Evidence from European countries," European Journal of Political Economy, Elsevier, vol. 26(4), pages 441-453, December.
    27. Ockenfels, Axel & Weimann, Joachim, 1999. "Types and patterns: an experimental East-West-German comparison of cooperation and solidarity," Journal of Public Economics, Elsevier, vol. 71(2), pages 275-287, February.
    28. Torgler, Benno, 2005. "Tax morale and direct democracy," European Journal of Political Economy, Elsevier, vol. 21(2), pages 525-531, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Sascha O. Becker & Lukas Mergele & Ludger Woessmann, 2020. "The Separation and Reunification of Germany: Rethinking a Natural Experiment Interpretation of the Enduring Effects of Communism," Journal of Economic Perspectives, American Economic Association, vol. 34(2), pages 143-171, Spring.
    2. Lóránd Králik & Erzsébet Szász, 2019. "VAT - Gap Convergence in Central and Eastern Europe," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 772-778, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Philipp Doerrenberg & Denvil Duncan & Clemens Fuest & Andreas Peichl, 2014. "Nice Guys Finish Last: Do Honest Taxpayers Face Higher Tax Rates?," Kyklos, Wiley Blackwell, vol. 67(1), pages 29-53, February.
    2. Philipp Doerrenberg & Andreas Peichl, 2022. "Tax Morale and the Role of Social Norms and Reciprocity - Evidence from a Randomized Survey Experiment," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 78(1-2), pages 44-86.
    3. Möhlmann, Axel, 2013. "Investor home bias and sentiment about the country benefiting from the tax revenue," Journal of Economic Psychology, Elsevier, vol. 35(C), pages 31-46.
    4. Gebhard Kirchgässner, 2011. "Tax Morale, Tax Evasion and the Shadow Economy," Chapters, in: Friedrich Schneider (ed.), Handbook on the Shadow Economy, chapter 10, Edward Elgar Publishing.
    5. Tomasz Mickiewicz & Anna Rebmann & Arnis Sauka, 2019. "To Pay or Not to Pay? Business Owners’ Tax Morale: Testing a Neo-Institutional Framework in a Transition Environment," Journal of Business Ethics, Springer, vol. 157(1), pages 75-93, June.
    6. Pickhardt, Michael & Prinz, Aloys, 2014. "Behavioral dynamics of tax evasion – A survey," Journal of Economic Psychology, Elsevier, vol. 40(C), pages 1-19.
    7. Tim Friehe & Markus Pannenberg, 2020. "Time preferences and political regimes: evidence from reunified Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 33(1), pages 349-387, January.
    8. Doerrenberg, Philipp & Duncan, Denvil & Fuest, Clemens & Peichl, Andreas, 2012. "Nice Guys Finish Last: Are People with Higher Tax Morale Taxed More Heavily?," IZA Discussion Papers 6275, Institute of Labor Economics (IZA).
    9. Colin C. Williams, 2014. "Confronting the Shadow Economy," Books, Edward Elgar Publishing, number 15370.
    10. Rodriguez-Justicia, David & Theilen, Bernd, 2018. "Education and tax morale," Journal of Economic Psychology, Elsevier, vol. 64(C), pages 18-48.
    11. Gabriel Leonardo & Jorge Martinez-Vazquez, 2016. "Politicians, bureaucrats, and tax morale: What shapes tax compliance attitudes?," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1608, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    12. Belmonte, Alessandro & Dell'Anno, Roberto & Teobaldelli, Désirée, 2018. "Tax morale, aversion to ethnic diversity, and decentralization," European Journal of Political Economy, Elsevier, vol. 55(C), pages 204-223.
    13. Konstantinos Fotiadis & Prodromos Chatzoglou, 2022. "The tax morale of exhausted taxpayers. The case of Greece," Constitutional Political Economy, Springer, vol. 33(3), pages 354-377, September.
    14. Wilfried Anicet Kouamé, 2015. "Tax Morale and Trust in Public Institutions," Cahiers de recherche 15-14, Departement d'économique de l'École de gestion à l'Université de Sherbrooke, revised Oct 2017.
    15. Alessandro Belmonte & Désirée Teobaldelli & Davide Ticchi, 2023. "Tax morale, fiscal capacity, and war," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(2), pages 445-474, June.
    16. Doerrenberg, Philipp & Duncan, Denvil, 2014. "Experimental evidence on the relationship between tax evasion opportunities and labor supply," European Economic Review, Elsevier, vol. 68(C), pages 48-70.
    17. Alexander, Phyllis & Balavac-Orlic, Merima, 2022. "Tax morale: Framing and fairness," Economic Systems, Elsevier, vol. 46(1).
    18. Pannenberg, Markus & Friehe, Tim & Wedow, Michael, 2015. "Let Bygones be Bygones? Political Regimes and Personalities in Germany," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112841, Verein für Socialpolitik / German Economic Association.
    19. Gloria Alarcón García & José Daniel Buendía Azorín & María del Mar Sánchez Vega, 2016. "El rechazo al fraude fiscal en España: antes y después de la Gran crisis," Hacienda Pública Española / Review of Public Economics, IEF, vol. 218(3), pages 33-56, September.
    20. 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.

    More about this item

    Keywords

    tax morale; German reunification; east-west differences; convergence; moral reasoning;
    All these keywords.

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects

    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:mhr:finarc:urn:sici:0015-2218(201403)70:1_3:poctet_2.0.tx_2-w. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Thomas Wolpert (email available below). General contact details of provider: https://www.mohrsiebeck.com/fa .

    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.