You don't need an invoice, do you? An online experiment on collaborative tax evasion

Lilith Burgstaller and Katharina Pfeil

No 22/6, Freiburg Discussion Papers on Constitutional Economics from Walter Eucken Institut e.V.

Abstract: Collaborative evasion of taxes and social security fees is prevalent in household services, when a household hires a service provider and no third party is involved. However, evidence on the determinants of collaborative tax evasion in general and the household context in particular is lacking. This paper examines two coordination mechanisms of collaborative tax evasion: A partner's signaled intention and information about majority's evasion behavior (empirical evasion expectation). We implement an interactive tax evasion game in an online labor market (MTurk) with 560 participants. Our findings show that priming with an empirical evasion expectation increases the fraction of evaded transactions by 20 percentage points. Our treatment manipulation of intention signals does not render a significant effect on evasion. However, when willingness to evade is signaled first in the chat, the probability of evasion increases by 45 percentage points.

Keywords: Collaborative Tax Evasion; Compliance; Social Norm; Intention; Online Experiment (search for similar items in EconPapers)
JEL-codes: D91 E26 H26 O17 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-exp, nep-iue, nep-pbe and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:aluord:2206

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