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Tax Morale and Compliance Behavior: First Evidence on a Causal Link

  • Martin Halla

Recent literature on tax evasion emphasizes the importance of moral considerations to explain compliance behavior. As a consequence scholars aim to identify factors that shape this so-called tax morale. However, the causal link between tax morale and actual compliance behavior is not established yet. Exploiting exogenous variation in tax morale - given by the inherited part of tax morale of American-born from their ancestors country of origin - our instrumental variable analysis provides first evidence on a causal effect of tax morale on the size of the underground production.

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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 2010-05.

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Length: 22 pages
Date of creation: Apr 2010
Date of revision:
Handle: RePEc:jku:nrnwps:2010_05
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  1. Benno Torgler, 2007. "Tax Compliance and Tax Morale," Books, Edward Elgar, number 4096.
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  29. Martin Halla, 2010. "The Link between the Intrinsic Motivation to Comply and Compliance Behavior – A Critical Appraisal of Existing Evidence," Economics working papers 2010-03, Department of Economics, Johannes Kepler University Linz, Austria.
  30. Friedman, Eric & Johnson, Simon & Kaufmann, Daniel & Zoido-Lobaton, Pablo, 2000. "Dodging the grabbing hand: the determinants of unofficial activity in 69 countries," Journal of Public Economics, Elsevier, vol. 76(3), pages 459-493, June.
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