 The contribution of behavioral economics to tax reform in the United KingdomJournal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2012, vol. 41, issue 4, 468-475 Abstract: This paper examines the contribution of behavioral economics to tax reform by examining two major reforms in the United Kingdom which may be seen as natural experiments – the reform of local taxation and the introduction of value added tax. The case for both was based strongly on mainstream economic analysis but one was a failure and the other a success. The introduction of the local community charge, or ‘poll tax’ as it became known, was such a failure that not only did it have to be repealed but it was also a factor in the downfall of Mrs. Margaret Thatcher as Prime Minister. The introduction of value added tax took more account of behavioral factors and was successful. The paper concludes that a wider approach based on behavioral as well as mainstream economics may have considerable advantages in developing tax policy. Keywords: Behavioral economics; Tax reform; Poll tax; Valued added tax (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:41:y:2012:i:4:p:468-475 DOI: 10.1016/j.socec.2011.07.004 Access Statistics for this article Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics) is currently edited by Pablo Brañas Garza More articles in Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics) from Elsevier |
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