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Anti-tax evasion, anti-corruption and public good provision: an experimental analysis of policy spillovers

Banerjee, Ritwik, Boly, Amadou and Gillanders, Robert orcid logoORCID: 0000-0001-9462-0005 (2022) Anti-tax evasion, anti-corruption and public good provision: an experimental analysis of policy spillovers. Journal of Economic Behavior and Organization, 197 . pp. 179-194. ISSN 0167-2681

Abstract
Our framed laboratory experiment analyses the causal relationship between corruption and tax evasion and explores whether deterring one may have desirable spill over effects on the other. We find that the possibility of corruption causally increases tax evasion. The data offers weak evidence that tax evasion leads to more corruption. Introducing a policy to detect and punish public officials who embezzle from tax revenues significantly reduces tax evasion on the part of citizens. However, auditing and punishing tax evading citizens do not deter embezzlement on the part of public officials. Public good provision increases in all deterrence treatments compared to a baseline, with a “Big bang” treatment in which both tax evasion and corruption are detectable and punishable being the most effective. A standalone anti-corruption monitoring and punishment strategy is the next most effective policy followed by tax auditing. Thus, faced with two “evils” regarding public good provision, allocating more resource to fighting corruption may be the better policy response.
Metadata
Item Type:Article (Published)
Refereed:Yes
Subjects:Business > Business ethics
DCU Faculties and Centres:DCU Faculties and Schools > DCU Business School
Publisher:Elsevier
Official URL:https://dx.doi.org/10.1016/j.jebo.2022.03.006
Copyright Information:© 2022 Elsevier
ID Code:27956
Deposited On:16 Dec 2022 12:35 by Thomas Murtagh . Last Modified 19 Sep 2023 04:30
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