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Taxpayer Search for Information: Implications for Rational Attention

Jeffrey Hoopes (), Daniel H. Reck and Joel Slemrod ()

American Economic Journal: Economic Policy, 2015, vol. 7, issue 3, 177-208

Abstract: We examine data on capital-gains-tax-related information search to determine when and how taxpayers acquire information. We find seasonal increases in information search around tax deadlines, suggesting that taxpayers seek information to comply with tax law. Positive correlations between stock market activity and search as well as year-end spikes in information search on capital losses when the market performs poorly suggest that taxpayers seek information for tax planning purposes. Policy changes and news events cause information search. These data suggest that taxpayers are not always fully informed, but that rational attention and exogenous shocks to tax salience drive taxpayer information search. (JEL D12, D83, H24, H31, K34)

JEL-codes: D12 D83 H24 H31 K34 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/pol.20140050
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Working Paper: Taxpayer search for information: implications for rational attention (2015) Downloads
Working Paper: Taxpayer Search for Information: Implications for Rational Attention (2013) Downloads
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