PROSPECT THEORY AND FACTORS AFFECTING TAX COMPLIANCE

Erhan Çelik and İsa Sağbaş
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Erhan Çelik: ALANYA ALAADDIN KEYKUBAT UNIVERSITY
İsa Sağbaş: AFYON KOCATEPE UNIVERSITY

Ekonomi Maliye Isletme Dergisi, 2023, vol. 6, issue 1, 1-21

Abstract: Prospect theory claims that psychological factors are also effective in individuals' decisions. Empirical studies conducted with the perspective of prospect theory show that besides the economic and financial factors that affect tax compliance, non-economic factors are also effective. Numerous behavioral finance studies have been conducted showing that psychology is also important in taxpayers' attitudes and behaviors towards taxes. In this study, it is aimed to determine the factors affecting tax compliance within the scope of prospect theory. The data obtained by questionnaire from 817 participants were analyzed with the Tobit regression model. The findings obtained from the study show that the assumptions of the prospect theory are effective in tax compliance and individuals with high loss aversion rate are willing to pay less tax than those with low

Keywords: Tax Compliance; Prospect Theory; Loss Aversion (search for similar items in EconPapers)
JEL-codes: C91 G41 H26 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:gnx:emid43:2023-6-1-1240981

DOI: 10.46737/emid.1240981

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