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Tax Morale, Slippery-Slope Framework and Tax Compliance: A Cross-section Analysis

  • Gabriele Ruiu

    (University of Cassino)

  • Gaetano Lisi

    (University of Cassino)

Following two important strands of tax compliance literature, this empirical paper develops a cross-section analysis in order to test both the role of tax morale on tax compliance decisions and the main predictions of the slippery slope framework. Using data from the World Value Surveys (WWS), we find empirical support for the slippery slope framework, since trust in and power of tax authorities are negatively and significantly related to a proxy for tax non-compliance behavior given by the size of the hidden economy. In particular, trust in tax authorities exerts a larger effect on shadow economy than the power of tax authorities. Instead, the relation between tax morale and our proxy for tax evasion is not statistically significant.

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Paper provided by Universita' di Cassino, Dipartimento di Scienze Economiche in its series Working Papers with number 2011-05.

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Length: 35 pages
Date of creation: 18 Jul 2011
Date of revision:
Handle: RePEc:css:wpaper:2011-05
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  1. Traxler, Christian, 2006. "Social Norms and Conditional Cooperative Taxpayers," Discussion Papers in Economics 1202, University of Munich, Department of Economics.
  2. Kolm, Ann-Sofie & Larsen, Birthe, 2002. "Social norm, the informal sector and unemployment," Working Papers 04-2002, Copenhagen Business School, Department of Economics.
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  9. Martin Halla, 2010. "Tax Morale and Compliance Behavior: First Evidence on a Causal Link," Economics working papers 2010-06, Department of Economics, Johannes Kepler University Linz, Austria.
  10. Friedrich Schneider & Andreas Buehn & Claudio E. Montenegro, 2011. "Shadow Economies All Over the World: New Estimates for 162 Countries from 1999 to 2007," Chapters, in: Handbook on the Shadow Economy, chapter 1 Edward Elgar.
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  21. repec:cup:cbooks:9780521876742 is not listed on IDEAS
  22. Benno Torgler, 2005. "Tax morale in Latin America," Public Choice, Springer, vol. 122(1), pages 133-157, January.
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  24. James Alm & Jorge Martinez-Vazquez & Benno Torgler, 2005. "Russian Attitudes Toward Paying Taxes ? Before, During, and After the Transition," CREMA Working Paper Series 2005-27, Center for Research in Economics, Management and the Arts (CREMA).
  25. Gaetano Lisi, 2011. "Job search theory and the slippery slope framework: an attempt to integration," Working Papers 2011-02, Universita' di Cassino, Dipartimento di Scienze Economiche.
  26. Falkinger, Josef, 1995. "Tax evasion, consumption of public goods and fairness," Journal of Economic Psychology, Elsevier, vol. 16(1), pages 63-72, March.
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  29. Benno Torgler, 2003. "Tax Morale and Institutions," CREMA Working Paper Series 2003-09, Center for Research in Economics, Management and the Arts (CREMA).
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