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Testing Enforcement Strategies in the Field: Legal Threat, Moral Appeal and Social Information

Author Info

  • Gerlinde Fellner
  • Rupert Sausgruber
  • Christian Traxler

Abstract

We run a large-scale natural field experiment to evaluate alternative strategies to en- force compliance with the law. The experiment varies the text of mailings sent to potential evaders of TV license fees. We find a strong alert effect of mailings, leading to a substantial increase in compliance. Among different mailing conditions a legal threat that stresses a high detection risk has a significant and highly robust deterrent effect. Neither appealing to morals nor imparting information about others' behavior enhances compliance. However, the information condition has a positive effect in municipalities where evasion is believed to be common. Overall, the economic model of crime performs remarkably well in explaining our data.

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Paper provided by The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria in its series NRN working papers with number 2009-23.

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Length: 45 pages
Date of creation: Oct 2009
Date of revision:
Handle: RePEc:jku:nrnwps:2009_23
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Keywords: Field experiments; law enforcement; compliance; deterrence;

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Find related papers by JEL classification:
  • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
  • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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Cited by:

  1. Henrik J. Kleven & Martin B. Knudsen & Claus T. Kreiner & Søren Pedersen & Emmanuel Saez, 2010. "Unwilling or Unable to Cheat? Evidence from a Randomized Tax Audit Experiment in Denmark," NBER Working Papers 15769, National Bureau of Economic Research, Inc.
  2. Cai, Jing & de Janvry, Alain & Sadoulet, Elisabeth, 2013. "Social Networks and the Decision to Insure," MPRA Paper 46861, University Library of Munich, Germany.
  3. Jose Apesteguia & Patricia Funk & Nagore Iriberri, 2010. "Promoting rule compliance in daily-life: Evidence from a randomized field experiment in the public libraries of Barcelona," Economics Working Papers 1231, Department of Economics and Business, Universitat Pompeu Fabra, revised Feb 2011.
  4. Carlo Fiorio & Stefano Iacus & Alessandro Santoro, 2013. "Taxpaying response of small firms to an increased probability of audit: some evidence from Italy," Working Papers 251, University of Milano-Bicocca, Department of Economics, revised Jul 2013.
  5. Egebark, Johan & Ekström, Mathias, 2013. "Can Indifference Make the World Greener?," Research Papers in Economics 2013:12, Stockholm University, Department of Economics.
  6. Alstadsæter, Annette & Jacob, Martin, 2013. "The effect of awareness and incentives on tax evasion," arqus Discussion Papers in Quantitative Tax Research 147, arqus - Arbeitskreis Quantitative Steuerlehre.
  7. Traxler, Christian, 2006. "Social Norms and Conditional Cooperative Taxpayers," Discussion Papers in Economics 1202, University of Munich, Department of Economics.
  8. Sebastian Eichfelder & Chantal Kegels, 2012. "Compliance costs caused by agency action? Empirical evidence and implications for tax compliance," Schumpeter Discussion Papers sdp12005, Universitätsbibliothek Wuppertal, University Library.
  9. Claudio Agostini & Claudia Martinez, 2013. "Tax Credits Response to Tax Enforcement: Evidence from a Quasi-Experiment in Chile," Working Papers wp_029, Adolfo Ibáñez University, School of Government.
  10. Dina Pomeranz, 2013. "No Taxation without Information: Deterrence and Self-Enforcement in the Value Added Tax," NBER Working Papers 19199, National Bureau of Economic Research, Inc.
  11. Joel Slemrod & Caroline Weber, 2012. "Evidence of the invisible: toward a credibility revolution in the empirical analysis of tax evasion and the informal economy," International Tax and Public Finance, Springer, vol. 19(1), pages 25-53, February.

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