Finding the Stronger Impact among Bribery, Financial Reward, and Religious Attitude: The Insights of Experiment on Environmental Tax Compliance in Indonesia

Deden Dinar Iskandar and Tobias Wuenscher

No 124316, 2012 Conference (56th), February 7-10, 2012, Fremantle, Australia from Australian Agricultural and Resource Economics Society

Abstract: The degradation of environmental quality has been one of the main concerns in Indonesia. The government has mentioned the environmental tax as the instrument of environmental management; however, the primary potential problem will be the issue of compliance. Inspired by the situation in Indonesia, this study is expected to contribute on environmental regulation and tax compliance literatures by examining and comparing the impact of bribery, financial reward, and religious attitude on compliance in a developing country where the bribery prevails. The study employs laboratory experiment approach. The results indicate that bribery has the strongest impact; the presence of bribery significantly worsens the compliance. Financial reward enhances the compliance only if the bribery is curbed, while religious attitude has no significant impact.

Keywords: Environmental Economics and Policy; Public Economics (search for similar items in EconPapers)
Pages: 22
Date: 2012-02
New Economics Papers: this item is included in nep-env, nep-exp, nep-iue and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aare12:124316

DOI: 10.22004/ag.econ.124316

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