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A Constitution for Knaves Crowds Out Civic Virtues
Abstract
When discussing constitutional design, economists concentrate on the propensity of individuals to free ride. Preventing opportunistic behaviour by knaves has costs by crowding out civic virtue. Another view emphasises active citizen participation in order to bolster civic virtue. A viable constitution must therefore be strict enough to deter exploitative behaviour. At the same time, the constitution should fundamentally convey trust towards its citizens and politicians. Distrusting public laws risk destroying the positive attitude of citizens and politicians towards the state. Civic virtue can be maintained and fostered by direct citizen participation via popular referenda and initiatives.
... Furthermore, there is a rapidly expanding empirical literature on the systematic interplay between institutions, economic incentives and moral behavior in behavioral economics (e.g. Frey 1997;Bowles 1998Bowles , 2016Deckers et al. 2016;Gintis 2005, Falk andTirole 2016) that provides novel answers to some of the objections raised at virtue ethics. In this paper we hope to contribute to this growing field. ...
... He (1995: 26) describes "the effects of a free-market system on self-reliance, initiative, and other virtues" and discredits governmental transfers claiming that "the present system corrupts the values transmitted to children." and Rockenbach 2003). In a similar vein, Frey (1997) observes this mechanism in the realm of tax compliance. When tax laws are restrictive, citizens respond with efforts to minimize their tax burden illegally. ...
... Incentives and morals became complements rather than substitutes. A similar lesson can be drawn from Frey's (1997) observations on individuals' willingness to pay taxes. Frey found that transparent and inclusive systems, which allow citizens to declare their own income and make generalized deductions, correspond with a higher tax morale. ...
Like other classical liberal thinkers, Buchanan mentions at several points in his oeuvre the necessary role of a 'constitutional attitude'-at the individual ('the private man') and social level ('the public man'). Buchanan's constitutional attitude is both explanatory and evaluative; it explains why citizens value liberty but also highlights one of the necessary conditions for the stability of a free society. We argue that Buchanan's idea of a 'constitutional attitude' is extremely relevant, though underdeveloped. Firstly, it remains an open question what exactly a constitutional attitude means in practice and, consequently, it is unclear what kind of institutions would foster it. Secondly, and more fundamentally, we believe that the success of his (classical) liberal project depends on some account of moral learning. In this regard, we think that Buchanan's distinction between the 'natural' and the 'artifactual' man is too rigid. Although Buchanan stresses the individual aspect of the process of self-constitution, he doesn't take sufficient account of how the institutional environment and our social relationships structure this process. We discuss to what extent a broadly neo-Aristotelian account of moral learning can provide a more robust foundation for Buchanan's ideas. One of our central claims is that it is always in an institutional context and under a certain set of social relationships that we can critically evaluate the type of persons we want to become. We discuss supporting empirical evidence from behavioral economics and derive some normative implications regarding the institutional contexts that would foster a constitutional attitude. JEL: A13; B25; B41; D91
... However, taking seriously the idea of a reflexive relationship between institutions and individual preferences, prudential political economy acknowledges that a 'constitution for knaves' might actually encourage people to behave in the very ways it was designed to deter. Frey (1997) observes this mechanism in the realm of tax compliance. When tax laws are restrictive, more citizens respond with efforts to minimize their tax burden illegally. ...
... Conversely, following de Tocqueville's reasoning, citizens' other-regardingness can be crowded in when the political process treats them as subjects capable of moral reasoning (Bowles 2016: 202). To enhance individuals' public-spiritedness, prudential political economy considers trusting laws, public deliberation, and direct participatory rights as important elements of 'good governance' (Frey 1997(Frey : 1051 As this brief discussion of crowding-out/in illustrates, preference endogeneity of the kind acknowledged by Hayek matters a great deal for political economy. For positive analysis, it implies that the selection of one institution rather than another cannot be explained by reference to individuals' exogenous preferences since the exposure to a certain environment may have created the preferences themselves. ...
... Hayek's reasoning reflects his view that the threat of opportunistic behaviour looms large and that the goal of policymaking should therefore be to design institutions so as to give entirely self-interested individuals extrinsic incentives to act in ways that promote the public good. However, taking seriously the idea of a reflexive relationship between institutions and individual preferences, prudential political economy acknowledges that a 'constitution for knaves' might actually encourage people to behave in the very ways it was designed to deter (Frey 1997). Extrinsic incentives like rewards and punishments are part of how a decision problem is framed. ...
... Conversely, following de Tocqueville's reasoning, citizens' other-regardingness can be crowded in when the political process treats them as subjects capable of moral reasoning (Bowles 2016: 202). To enhance individuals' public-spiritedness, prudential political economy considers trusting laws, public deliberation and direct participatory rights as important elements of 'good governance' (Frey 1997(Frey : 1051 As this brief discussion of crowding-out/in illustrates, preference endogeneity of the kind acknowledged by Hayek matters a great deal for political economy. For positive analysis, it implies that the selection of one institution rather than another cannot be explained by reference to individuals' exogenous preferences since the exposure to a certain environment may have created the preferences themselves. ...
Abstract: In this paper, we analyse Hayek’s views on endogenous preferences. Perhaps surpris-ingly in the light of his remarks that economists ought to take people’s preferences as given, there are several places in Hayek’s economics and political economy where preference endogeneity plays a significant role. We begin by documenting those cases, providing an historical overview of Hay-ek’s views on preference endogeneity. We then go on to argue that in his work on theoretical psy-chology Hayek provides an account of the causal mechanisms through which people’s preferences can change in response to their social context. Finally, we assess Hayek’s views on preference en-dogeneity in the light of more recent work on the topic in behavioural economics, before going on to consider what Hayek’s analysis can add to contemporary debates in political economy.
Keywords: Friedrich August von Hayek; Endogenous Preferences; Behavioural Economics; Theo-retical Psychology; Political Economy
JEL Classification: B31; B41; D91; P16
... Institutional elements that foster a constitutional attitude: public discussion and political participation Rule-shaping behavior is costly for the individual in terms of time and effort; it is also inherently an activity with public goods character since there is typically no rivalry in rule consumption and it is hard to exclude single constituents once a rule is implemented. There is substantial empirical evidence that citizens' willingness to overcome the free rider problem and contribute to the provision of public goods (such as rule-making) is higher when they perceive to be treated as moral subjects who are invited to participate in an ongoing public discourse (Frey 1997;Ostrom 2000;Bowles 2016;Hargreaves Heap 2020). 24 This supports the idea that individuals' constitutional attitude is a resource for rule-making that can be mobilized through informal discussions and formal participation in political processes. ...
... Through active participation in an ongoing democratic process people acquire the knowledge, aptitudes, and skills for that very same process (Macedo 2006;Barrett and Zani 2014). For instance, participation can be enhanced by institutionalizing citizens' rights to initiate laws that are neglected by legislators and reverse political decisions by means of qualified referenda (Frey 1997). In addition, the possibility of being engaged in polycentrically (and not centrally) organized communities can lead to local solutions to collective action problems which result in higher levels of rule compliance and civic engagement (Ostrom 1998(Ostrom , 2000. ...
Buchanan mentions at several points in his oeuvre the necessary role for a constitutional attitude. This attitude is both explanatory and evaluative; it explains why citizens value liberty but also highlights one of the necessary conditions for the stability of a free society. We argue that Buchanan's idea of a 'constitutional attitude' is extremely relevant, though underdeveloped. Firstly, it remains an open question what exactly a constitutional attitude means in practice and it is unclear what kind of institutions would foster it. Secondly, we believe that the success of his constitutional political economy project depends on some account of moral learning. Although Buchanan stresses the individual aspect of the process of self-constitution, he doesn't take sufficient account of how the institutional environment and our social relationships structure this process. We discuss to what extent a broadly neo-Aristotelian account of moral learning can provide a more robust foundation for Buchanan's ideas.
... Democratic inclusion and political participation have been studied for decades by modern political science and political economy as an institution that fosters the integration of individuals into a society and promotes a sense of belonging. These beneficial effects can be generated through political participation in itself, as participatory political institutions foster cooperation (Acemoglu and Robinson, 2013) and civic virtue (Frey, 1997). Alternatively, individuals can directly improve their relative situation and well-being (Brubaker, 1990;Hayduk, 2006) through participation in the political process by aligning public policies to their interests and achieving representation of their preferences (Dahl, 1971;Walzer, 2008;Vernby, 2013). ...
... Development of Immigrant Integration Outcomes, 1991-1997 Note: Development of integration outcomes in control and treatment group of immigrants. The treatment group includes individuals with Greek or Italian citizenship, while the control group comprises Turkish individuals. ...
This dissertation consists of three empirical essays on migration and labor economics, with a particular focus on the evaluation of policy interventions in Germany. The three essays analyze three reforms and their effects on immigrants and establishments on the labor market. The first two essays investigate the effect of policy instruments on immigrant integration in Germany. The policy instruments under consideration are naturalization and voting rights acquisition in Germany. The third study analyzes the impact of dismissal protection regulations on small German establishments. The first study investigates the causal impact of naturalization on the labor market outcomes of immigrants in Germany. The study includes 3 different outcome groups: indicators of labor market access, outcomes describing success on the labor market and measures of investment in host-country specific human capital. The analysis focuses on two reforms of German citizenship laws in 1991 and 2000, which introduced and changed minimum residency duration requirements for German citizenship eligibility. The study exploits the exogenous variation generated by these two reforms in naturalization regulations and applies an instrumental variable estimation strategy. It uses a novel dataset collected by the Institute of Employment Research (IAB) in cooperation with the German Socio-Economic Panel (SOEP), the IAB-SOEP Migration sample. This dataset provides detailed information on recent immigrants and their migration biographies, which allows a precise calculation of eligibility for citizenship. The estimation sample consists of first-generation immigrants born abroad, aged 17-65, and who had not obtained German citizenship at birth. After taking into account the potential endogeneity of naturalization, the findings reveal that male immigrants' labor market outcomes do not benefit significantly from naturalization. In contrast, naturalization decreases the risks of unemployment and welfare dependence and increases employment stability for female immigrants. The second study analyzes the causal effects of non-citizen voting rights in municipal elections on the integration of EU immigrants in Germany. The analysis considers the following outcomes as measures for immigrant integration: subjective well-being, German language skills, the intention to stay in Germany permanently and identifying as a German. The analysis exploits a late-1995 extension of voting rights in German municipal elections to non-German European Union citizens residing in Germany to identify a causal effect of voting rights. The study applies difference-in-differences techniques using this reform as a source of exogenous variation in voting eligibility. Greek and Italian immigrants who acquire municipal voting rights serve as the treatment group, while the control group consists of Turkish immigrants. Using a representative longitudinal survey dataset, the German SOEP, the findings suggest that there is no significant effect of extending municipal voting rights to EU immigrants on any of the analyzed integration outcomes. The final study examines the causal effects of relaxed dismissal protection on worker flows and hire quality in small establishments in Germany. To identify the causal effects of dismissal protection regulations, the study exploits a change in German dismissal protection law in 2004, which raised the establishment size threshold from more than five to more than 10 full-time equivalent (FTE) workers. This reform serves as a source of exogenous variation in dismissal protection coverage in a difference-in-differences estimation framework. While the treatment group consists of establishments with 5.75 to 9.25 FTE workers, establishments with 10.75 to 20 FTE employees form the control group. The worker flow outcomes include the number of hirings and separations within a given year, and the respective hiring and separation rates. Using the unique linked employer-employee administrative data provided by the IAB, I find a positive significant effect on both hirings and separations in establishments. The increase in separations is smaller in magnitude and associated with a time lag. Incumbent workers maintaining their protections after the reform could explain this. In contrast, I do not find any effects of relaxed dismissal protection on the minimum or the spread of hire quality.
... The focus of tax enforcement is on prosecuting illegal behavior through extensive tax audits and strict penalties (Allingham and Sandmo, 1972 voluntary tax compliance is changing. The new paradigm is the tax authority treats taxpayers as clients (Alm et al., 2010;Fre, 1997;Rainey and Thompson, 2006). Instead of creating an atmosphere of distrust that raises a negative attitude from the taxpayers side, the tax authority needs to treat taxpayers respectfully, provide excellent service, and increase the role and participation of taxpayers in tax collection (Alm and Torgler, 2011;Braithwaite, 2003;Hofmann et al., 2008). ...
... Recently, the paradigm for approaching taxpayers has changed. The tax authority treats taxpayers no longer as potential criminals but as clients (Alm et al., 2010;Fre, 1997;Rainey and Thompson, 2006). Alm and Torgler (2011) propose to educate taxpayers by providing services to help them and for simplifying tax laws and tax procedures. ...
The purpose of this study is to examine differences in perceptions of generations related to service-orientation and trust to tax officers. Changes traditional paradigm of the relationship between tax officers and taxpayers from “cops and robbers” to "clients" cause the research in perception of service-orientation and trust to tax officers to be necessary in order to improve voluntary tax compliance. This study also explains perceptions of tax fairness in three perspectives which are vertical equity, horizontal equity, exchange equity. The survey was conducted in 2018 with 165 self-employment individual taxpayers consisting of three generations, Millennials, X, and Baby Boomers from two types of work, retail/production and services business. This study uses quota sampling to collect respondents and use ANOVA statistical tests. The results of the study indicate differences in perceptions regarding service-orientation between generations. However, there are no differences in perception related trust to tax officers between generations. This research also found that Millenials, X, and Baby Boomer have different perceptions of vertical equity, horizontal equity, and exchange equity
... From a microeconomic perspective, this process of adaptation is labeled endogenous preference change since the social environment does not only exogenously constrain actions and change relative prices, but performatively shapes the elements in individuals' utility function. For instance, Bowles (1998) and Frey (1997) show how social environments that stress material incentives affect fundamental social interaction (like, e.g., democratic participation, parental child-rearing, or school systems) and cause individuals to internalize values and form preferences in line with the materialistic characteristics of the social system. In this context, Hoff and Stiglitz (2016) emphasize the crucial role of acquired "cultural mental models", such as narratives and worldviews, which work as lenses through which the socially embedded individual filters information about the world. ...
Traditionally, economists and tax theorists justify taxation by means of externalities. In recent years, both scholars and policymakers have begun advocating ‘sin taxes’ on goods whose consumption causes ‘internalities’: unaccounted-for costs that a person imposes on herself, not on others. In this paper, we argue that sin taxes rest on a static model of individual choice. They retain neoclassical rationality—with its endorsement of stable and context-independent preferences—as a normative benchmark for good, i.e., welfare-increasing choice. We contrast this model with a more dynamic understanding of choice in which preferences are context-dependent, evolving, and open to individual processes of experimentation. Such a dynamic understanding of choice is backed by recent findings in psychology and behavioral economics and is integral to the political economy of John Stuart Mill. Contributing to the most recent literature in behavioral welfare economics, we argue that the reality of dynamic and evolving preferences animates a contractarian perspective on public policy which, in turn, provides strong arguments against the sin-tax agenda and supports preference-neutral tax rules.
... However, tax avoidance and tax evasion are interdependent. The intrinsic motivation to pay taxes, tax morale (Frey 1992;Luttmer and Singhal 2014), affects both tax avoidance and evasion and is also affected (crowded out) by government policy (Frey 1997) as well as subject to social norm-setting (Alm et al. 1999). The effect of tax avoidance on tax morale, in turn, affects tax evasion and vice versa. ...
International tax policy reforms such as Country-by-Country Reporting and Automatic Exchange of Information aim to increase tax compliance and revenues. Using a tax ecosystems perspective, this chapterapplies an agent-based simulation to assess the effects of these reforms. We demonstrate for EU Member States and selected European countries that reforms can be counteracted by tax competition and tax spillover effects which reduce their effectiveness. The model estimates European corporate tax revenue losses from tax avoidance and evasion of €104.9 billion in 2019. Without further reforms they would increase to €135.8 billion in 2029. A complete implementation of both Country-by-Country Reporting and Automatic Exchange of Information would help to decrease the total CIT gap by 16.4 per cent to €113.5 billion in the year 2029 The model explains why the seemingly small effect of CbCR is not so small and why the effect of AEoI may not be as promising as it seems.
... It may be the case that treating people as though they are extrinsically motivated will actually cause them to be so motivated, creating the need for incentives and rewards where none existed before. (Further discussion of the idea that designing institutions as if people are knaves causes them to behave as such can be found in Frey, 1997b). Or, when we desire to change the culture of institutions, designers could consider what frames are in play and how to change them. ...
“Das Adam Smith Problem” is the name given by eighteenth-century German scholars to the question of how to reconcile the role of self-interest in the Wealth of Nations with Smith’s advocacy of sympathy in Theory of Moral Sentiments . As the discipline of economics developed, it focused on the interaction of selfish agents, pursuing their private interests. However, behavioral economists have rediscovered the existence and importance of multiple motivations, and a new Das Adam Smith Problem has arisen, of how to accommodate self-regarding and pro-social motivations in a single system. This question is particularly important because of evidence of motivation crowding, where paying people can backfire, with payments achieving the opposite effects of those intended. Psychologists have proposed a mechanism for the crowding out of “intrinsic motivations” for doing a task, when payment is used to incentivize effort. However, they argue that pro-social motivations are different from these intrinsic motivations, implying that crowding out of pro-social motivations requires a different mechanism. In this essay I present an answer to the new Das Adam Smith problem, proposing a mechanism that can underpin the crowding out of both pro-social and intrinsic motivations, whereby motivations are prompted by frames and motivation crowding is underpinned by the crowding out of frames. I explore some of the implications of this mechanism for research and policy.
... Además, en el Perú, no hay una cultura tributaria que fomente la recaudación. Frey (1997) desarrolla un modelo en el que, además de considerar las variables de Alingham & Sandmo (1972), añade motivaciones intrínsecas que influyen en la decisión de evadir, como son su efecto en la conciencia y reputación. En una encuesta realizada por Datum (2014), el 37% de los encuestados respondió que no paga impuestos y, del 63% restante, un 28% reconoció que buscaba alternativas para pagar menos. ...
El presente volumen de la serie Ensayos de Economía Aplicada contiene nueve ensayos, los cuales son versiones resumidas y editadas de cinco TIE culminados en junio de 2017 y cuatro culminados en noviembre del mismo año. Además de reunir los dos requisitos antes mencionados, a sus respectivos autores les fue posible resumirlos y presentarlos en una versión ensayo dentro de los límites de extensión y plazos de entrega fijados para la preparación de este volumen.
... Il tentativo compiuto dagli autori è stato di arricchire l'analisi teorica introducendo nella funzione di utilità una variabile "reputazione" che sintetizzerebbe l'effetto dei fattori non considerati. 72 Secondo Frey (1997), la distinzione tra motivazioni intrinseche, ossia quelle socio-psicologiche, ed estrinseche, ossia quelle economiche, è di fondamentale importanza per valutare l'effetto prodotto dalle politiche di controllo sulle decisioni di evasione. ...
... He invokes extensive empirical work to show that humans exhibit diverse prosocial motivations, responding to a range of non-material, non-self-interested motivations, from reciprocity to group identity through, in some cases, altruism (2016a, 8). Experimental and observational data has exhaustively documented that the effects of standard economic incentive tools such as material rewards and punishments are not only inseparable from but, in some cases, detrimental to the sum of motivations across the target population (Bowles and Hwang 2008;Bowles and Polania-Reyes 2012;Frey 1997;Frey and Jegen 2001). One cannot buy friendship and love with money. ...
This book explores the potential creation of a broader collaborative economy through commons-based peer production (P2P) and the emergent role of information and communication technologies (ICTs). The book seeks to critically engage in the political discussion of commons-based peer production, which can be classified into three basic arguments: the liberal, the reformist and the anti-capitalist. This book categorises the liberal argument as being in favour of the coexistence of the commons with the market and the state. Reformists, on the other hand, advocate for the gradual adjustment of the state and of capitalism to the commons, while anti-capitalists situate the commons against capitalism and the state. By discussing these three viewpoints, the book contributes to contemporary debates concerning the future of commons-based peer production. Further, the author argues that for the commons to become a fully operational mode of peer production, it needs to reach critical mass arguing that the liberal argument underestimates the reformist insight that technology has the potential to decentralise production, thereby forcing capitalism to transition to post-capitalism. Surveying the three main strands of commons-based peer production, this book makes the case for a post-capitalist commons-orientated transition that moves beyond neoliberalism.
... Pervasive accountability mechanisms make it difficult for officials to demonstrate their trustworthiness, because their actions will reasonably be seen not as taking the fact that trust has been placed in them as a reason for performing their official duties, but only as responding to external sanctions. Subjecting officials to external sanctions crowds out desirable internal motivations, including a sense of integrity, concern for the public good, and trust-responsiveness. 85 It signals that external intervention is the controlling factor in official decision-making. Third, they argue, frequent, publicly visible operation of accountability mechanisms undermine confidence of people in government institutions and public officials. ...
... In other contexts, such as those of our study where agents are less vulnerable, they will be more capable of acting in accordance with their ideals. Furthermore, philosophical appeals to virtue have been found throughout history to be morally motivating, indeed at times more so than financial incentives [4,[74][75] or legal sanctions [36] in civic contexts. Philosophical values in leadership have been shown to influence employee beliefs and behaviors [76]. ...
Extant research suggests that individuals employ traditional moral heuristics to support their observed altruistic behavior; yet findings have largely been limited to inductive extrapolation and rely on relatively few traditional frames in so doing, namely, deontology in organizational behavior and virtue theory in law and economics. Given that these and competing moral frames such as utilitarianism can manifest as identical behavior, we develop a moral framing instrument—the Philosophical Moral-Framing Measure (PMFM)—to expand and distinguish traditional frames associated and disassociated with observed altruistic behavior. The validation of our instrument based on 1015 subjects in 3 separate real stakes scenarios indicates that heuristic forms of deontology, virtue-theory, and utilitarianism are strongly related to such behavior, and that egoism is an inhibitor. It also suggests that deontic and virtue-theoretical frames may be commonly perceived as intertwined and opens the door for new research on self-abnegation, namely, a perceived moral obligation toward suffering and self-denial. These findings hold the potential to inform ongoing conversations regarding organizational citizenship and moral crowding out, namely, how financial incentives can undermine altruistic behavior.
... Evidence from behavioural economics suggests that an institution that nurtures and upholds social preferences can achieve socially desirable outcomes cost-effectively that might be unattainable by incentives that appeal only to self-interest (Bowles 2008;Cooter 1998;Frey 1997;Ostrom 2000). Herein we investigate whether self-selected politicians' social preferences for keeping their promises and others' well-being help attain fair outcomes in an environment in which it is easy for them to serve their private interests. ...
... Conceptually, when industry actors promote compliance in an autonomous or independent manner, intervening might become not only redundant or unnecessary, but also costlier for the authorities (O'Rourke 2003). This is consistent with the idea that strong deterrence can hinder voluntary compliance (Frey 1997;Mendoza et al. 2017). Government intervention can be desirable or necessary, however, when industry actors are evidently passive or ineffective. ...
OBJECTIVE:
Industry actors (organizations, associations) can influence the way in which firms comply with regulations. This study examines how this influence process is affected by government intervention.
METHODS:
Using official, anonymized data from the entire industry of financial intermediation in the Netherlands (N = 8655 firms), we examine how firms’ affiliations with industry actors relate to (1) voluntary actions aligned with improving regulatory compliance (e.g., requesting audits, attending workshops), and (2) law violations. Industry actors are distinguished between trade associations and the industry’s self-regulatory organization (SRO), which is subject to more government intervention. The analysis employs Poisson regressions to explain count variables, and bootstrapping to assess indirect associations. A series of robustness tests focus on relevant sub-samples, employ exact matching to address possible self-selection, and incorporate lagged dependent variables.
RESULTS:
The association between affiliations with industry actors and law violations is negative and significant. This association is more indirect for trade associations than for the SRO (i.e., it is more strongly mediated by the voluntary actions firms take and which help to improve compliance).
CONCLUSIONS:
These findings go in line with the theory that government intervention makes industry-self regulation more mandated and less voluntary. Under less government intervention, industry actors may promote more voluntary efforts to comply.
... We start from the premise that focusing on rational decision making based on pure self-interest and neglecting contextual drivers of behavior may undermine the goal of achieving behavioral change in a cost-effective way. Scholars in psychology, economics, and philosophy have long recognized that prosocial preferences and public interventions could interact in a detrimental way, potentially leading to motivational crowding out (Deci and Ryan 1985;Frey 1997;B enabou and Tirole 2006). However, one aspect of human behavior that is underappreciated is the fact that social and policy interventions can also lead to crowding in (Ostrom 2010). ...
Climate change is a global externality that has proven difficult to address through formal institutions alone due to the public good properties of climate change mitigation and the lack of a supranational institution for enforcing global treaties. Given these circumstances, which are arguably the most challenging for international cooperation, commitment problems and free-riding incentives for countries to delay costly mitigation efforts are major obstacles to effective environmental agreements. Starting from this premise, we examine domestic mitigation efforts, with the goal of assessing the extent to which the willingness of individuals to contribute voluntarily to the public good of climate mitigation could be scaled up to the global level. Although individual environmental actions are clearly insufficient for achieving ambitious global mitigation targets, we argue that they are nevertheless initial and essential steps in the right direction. In fact, individual and community efforts may be particularly important if local interventions encourage shifts in norms and behaviors that favor large-scale transformations. With this in mind, we discuss the importance of the visibility of norms and the role of beliefs when such visibility is lacking and their implications for leveraging cooperative behavior to increase climate mitigation efforts locally and globally.
... Tax morale, or the motivation that explains the 'low' tax evasion in many countries, depends to a great extent on trust between the government and the citizens. A constitution which tries to discipline citizens can be perceived as distrusting and therefore decrease civic virtue (see Frey, 1997b for empirical evidence). ...
Die Dissertation präsentiert eine empirische Analyse von Spendeverhalten von Zürcher Studierenden zu zwei sozialen Fonds und von Freiwilligenarbeit in Deutschland. Die Resultate der Dissertation können in fünf Kernpunkten zusammengefasst werden: Erstens, Menschen sind in bestimmten, anonymen Entscheidungssituation bereit, zu einem öffentlichen Gut beizutragen. Mehr als 65 Prozent der Studierenden der Universität Zürich zahlen in beide sozialen Fonds ein. Zweitens, soziale Vergleiche sind für pro-soziales Verhalten entscheidend. In einem Feldexperiment, in welchem exogen die Erwartungen der anderen variiert wurden, kann nachgewiesen werden, dass das Verhalten der Umgebung das eigene Verhalten beeinflusst: Menschen sind eher bereit, zu einem öffentlichen Gut beizutragen, wenn dies andere auch tun. Drittens, in einem zweiten Feldexperiment wurde die Spende von gewissen Personen von einer anonymen Institution erhöht. Die entsprechenden Studierenden reagierten mit einer erhöhten Spendebereitschaft. Viertens, es gibt systematische Unterschiede im Spendenverhalten zwischen Ökonomen und Nichtökonomen, diese Unterschiede haben aber nichts mit der Lehre der Ökonomie zu tun. Ökonomen sind bereits am Anfang des Studiums weniger bereit, in die beiden sozialen Fonds einzuzahlen. Fünftens, basierend auf dem deutschen Panel empirisch, wird gezeigt, dass Spenden und Freiwilligenarbeit machen glücklich. Um die Kausalität zu klären, ob Freiwilligenarbeit glücklicher macht oder ob glücklichere Menschen eher freiwillig arbeiten, wird in der Dissertation auf die Wiedervereinigung als exogenen Schock zurückgegriffen. Der partielle Zusammenbruch der Infrastruktur für Freiwilligenarbeit erlaubt es empirisch zu zeigen, dass tatsächlich freiwilliges Engagement einen direkten Nutzen in Form von subjektivem Wohlbefinden bewirkt. The dissertation analyses empirically contributions of money and time to public goods. The empirical analysis is based on contributions of students to two social funds at the University of Zurich and on patterns of volunteering in Germany. The dissertation points out five main results: First, people are willing to contribute to a public good even in an anonymous decision situation. More than 65 percent of the student population is prepared to donate money to the two social funds. Second, people's pro-social behavior is influenced by the behavior of their reference group. The dissertation shows based on a field experiment that an exogenous variation in the average group behavior influences subject's behavior. People's willingness to behave pro-socially increases if others do so as well. Third, pro-social behavior is price sensitive. In a second field experiment, people's donations were matched by a third party. A higher matching resulted in an increased willingness to contribute to the two social funds. Fourth, economists are on average less likely to behave pro-socially than non- economists. The difference is, however, due to a selection process of 'selfish' people into economics. Training in economics does not increase people's selfishness. The dissertation therefore rejects the indoctrination hypothesis. Fifth, pro-social behavior increases people's subjective well-being. Based on a natural experiment in East Germany, the empirical results shows that an exogenous loss of the opportunity to volunteer decreases people's happiness level.
... Further discussion of the idea that designing institutions as if people are knaves causes them to behave as such can be found in Frey (1997b). ...
I connect commodification arguments to an empirical literature, present a mechanism by which commodification may occur, and show how this may restrict the range of goods and services that are subject to commodification, therefore having implications for the use of commodification arguments in political theory. Commodification arguments assert that some people’s trading a good or service can debase it for third parties. They consist of a normative premise, a theory of value, and an empirical premise, a mechanism whereby some people’s market exchange affects how goods can be valued by others. Hence, their soundness depends on the existence of a suitable candidate mechanism for the empirical premise. The ‘motivation crowding effect’ has been cited as the empirical base of commodification. I show why the main explanations of motivation crowding – signaling and over-justification – do not provide mechanisms that could underpin the empirical premise. In doing this, I reveal some requirements on any candidate mechanism. I present a third explanation of motivation crowding, based on the crowding out of frames, and show how it fulfills the requirements. With a mechanism in hand, I explore the type of goods and services to which commodification arguments are applicable. The mechanism enables markets to break down ‘shared valuations’, which is a subset of the valuations that proponents of commodification arguments are concerned with. Further, it can only break down relatively fragile shared understandings and therefore, I suggest, it cannot support a commodification argument regarding the sale of sexual services.
... En outre ces deux mécanismes de discipline du comportement opportuniste peuvent être plus substituantes que complémentaires. En particulier, les contrats complexes peuvent porter atteinte à la construction de la confiance entre partenaires (Frey 1997), car le recours à des mesures incitatives et/ou des punitions peut signaler une absence de réciprocité et de comportement altruiste (Ghoshal & Moran 1996 ;Fehr & Gachter 2002). Si la gouvernance relationnelle peut effectivement remplacer les mécanismes de protection des contrats formels, alors nous supposerons que : ...
Cet article examine la relation entre les choix d’arrangement contractuel et la régulation publique de sécurité alimentaire à la lumière d'une recherche empirique qui établit l'importance des spécificités géographiques. Après avoir examiné les fondements théoriques des coûts de transaction et l'impact de la régulation publique sur la spécificité des actifs, l'étude analyse les enquêtes empiriques menées sur les formes contractuelles dans le secteur de l'élevage laitier en Algérie. Les implications des théories des coûts de transaction pour les politiques actuelles sont recommandées pour règlementer et organiser le secteur laitier souffrant de problème de sécurité alimentaire.
... Sobre o potencial de propostas para emitir sinais sobre características do proponente e a dificuldade que daí decorre para derrogar normas dispositivas, ver Spier (1992); Ben-Shahar e Pottow (2006). 17 Para a ideia de que leis que manifestem desconfiança em relação aos cidadãos podem ter um efeito pernicioso para as virtudes, ver Frey (1997). falando, ou de uma outra que dispensa tratamento implacável para os mesmos casos e, ao fazê-lo, torna manifestações de confiança mais difíceis. ...
O artigo responde a uma crítica de Seana Shiffrin ao direito contratual. Nela, a autora afirma que certa leniência com o inadimplemento contratual leva o direito a divergir da moral respeitante a promessas, o que atenta contra o interesse dos cidadãos em se desenvolverem moralmente e conspira contra uma cultura igualitária. Afirma-se que Shiffrin erra ao supor que leis mais severas forjem cidadãos mais virtuosos, mas que sua crítica tem o mérito de ressaltar a influência do direito sobre as preferências dos cidadãos, ponto negligenciado por teorias do direito contratual associadas à justiça distributiva.
... Een onderzoek waar het is aangetoond heeft betrekking op de relatie tussen de democratische mogelijkheden van inspraak op gevoerd beleid en het gedrag omtrent de belastingaangifte in Zwitserse cantons (regio's). Wanneer mensen de perceptie hadden dat ze meer inspraak hadden op het gevoerde overheidsbeleid dan was er een hogere intrinsieke motivatie om belasting te betalen en dus eerlijk de belastingaangifte in te vullen dan in cantons waar de gepercipieerde inspraakmogelijkheden kleiner waren (Frey, 1997). Dit komt omdat de intrinsieke motivatie toeneemt wanneer men het gevoel heeft goed geïnformeerd en eerlijk behandeld te worden. ...
De rol van banken in de samenleving is onderwerp van veel maatschappelijk debat. Er wordt aangedrongen op een stabiel en vooral dienstbaar bankwezen. De overheid tracht met tal van maatregelen het gedrag van bankmanagers in de gewenste richting te sturen. Veel van deze maatregelen hebben te maken met het beperken van de (variabele) beloning. Blijkbaar ziet de overheid een relatie tussen beloning (extrinsieke motivatie) en het gewenste gedrag van bankiers in de toekomst. Dit artikel onderzoekt vanuit motivatieperspectief of deze verwachting terecht is. Er wordt daarbij onderscheid gemaakt tussen het graduele verschil tussen intrinsieke en extrinsieke motivatie en mogelijke crowding-in- en crowding-out-effecten van intrinsieke motivatie. Tevens worden verbanden gelegd naar het agencymodel en het stewardshipmodel in de economische organisatietheorie. Het onderzoek is uitgevoerd als een Delphi-onderzoek onder senior bankiers en financieel journalisten. De resultaten laten zien dat de respondenten van mening zijn dat bankiers (toch) grotendeels intrinsiek gemotiveerd zijn, al wordt status en macht belangrijk gevonden. Men denkt dat een overgang van een agencymodel naar een (maatschappelijk gewenst) stewardshipmodel binnen bestaande bancaire organisaties mogelijk zou moeten zijn, al zal dat wel veel tijd kosten. Opmerkelijk is dat 80% van de respondenten aangeeft dat de toegenomen regelgeving een zeer groot obstakel vormt als het gaat om de intrinsieke motivatie van bankiers. Dit obstakel vormt voor de overheid een probleem want juist het verminderen van regelgeving lijkt maatschappelijk gezien een veel grotere uitdaging dan het beperken van de beloning van bankiers. Toch zijn beide nodig voor de succesvolle invoering van het stewardshipmodel in de bancaire sector.
... Fiscal psychologists contend that noneconomic factors strongly influence taxpayers' compliance behavior. Frey (1997) asserts that individuals are endowed with civic virtue, which can be crowed out if the government violates procedural equity norms. According to Frey and Feld (2002), the relationship between taxpayers and the government can be modeled as an implicit, psychological contract. ...
The purpose of this study is to investigate the effect of religiosity and religion on tax equity. Most prior studies have argued that higher taxpayers’ religiosity reduces tax evasion and increases the level of tax morale. Various studies have also shown that tax evasion and morale vary with perceptions of tax equity, including exchange, horizontal, and vertical equities. However, the relationship between religiosity and tax equity has not been studied actively. Especially in Korea, there has been considerable debate about the implementation of taxation for clergies. Therefore, the relationship between religiosity and tax equity will be analyzed clearly using Korean survey panel data. The results of this study show that religiosity and religion do not affect exchange and horizontal equity; however, each religion affects vertical equity. This implies that economic and social incentives are more effective than religiosity and religion on taxpayers’ tax evasion or morale.
... Benkler (2016a, 8) refers also to extensive empirical work carried out across a vast array of disciplines in the last decades, which shows that humans exhibit diverse pro-social motivations, responding to a range of non-material, non-self-interested motivations, from reciprocity to group identity through, in some cases, altruism (Camerer and Fehr 2004;Fehr and Gintis 2007;Ostrom 1990). Experimental and observational data has exhaustively documented that the effects of standard economic incentive tools such as material rewards and punishments are not only inseparable from but, in some cases, detrimental to the sum of motivations across the target population (Bowles and Polania-Reyes 2012;Bowles and Hwang 2008;Frey and Jegen 2001;Frey 1997). Not only is there a tension between material rewards and pro-social motivations, but also between diverse pro-social motivations themselves. ...
Yochai Benkler defines commons-based peer production as a non-market sector of information, knowledge and cultural production, which is not treated as private property but as an ethic of open sharing and co-operation, and is largely enhanced by the Internet and free/open source software. This paper makes the case that there is a tension between Benkler’s liberal commitments and his anarchistic vision of the commons. Benkler limits the scope of commons-based peer production to the immaterial production of the digital commons, while paradoxically envisaging the control of the world economy by the commons. This paradox reflects a deeper lacuna in his work, revealing the absence of a concrete strategy as to how the immaterial production of the digital commons can connect to material production and control the world economy. The paper concludes with an enquiry into some of the latest efforts in the literature to fill this gap.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
i>Federalismo fiscal en la práctica brinda un conjunto de elementos para el estudio de los gobiernos multinivel y de las relaciones fiscales intergubernamentales. El enfoque es empírico, centrado en el estudio de variables fiscales de la nación, las provincias y las municipalidades de la Argentina. Se estudian también las relaciones fiscales entre esos niveles de gobierno. (del texto de contratapa)</i
Will experience with direct democracy influence men's and women's political beliefs differently? Despite the closed gender gap in voter turnout, women remain less interested in politics and participate less frequently in non-voting activities than men. Scholars find women's lower sense of internal political efficacy as the origins of these gender gaps. In this paper, I examine whether the experience of direct participation in political decision-making alters women's feelings of internal political efficacy differently from it does men's. Building on the insights from the literature on the gendered psychological traits, I theorize that voting in referendums will promote men's internal political efficacy but not women's, because of women's greater susceptibility to the psychological costs of participation in referendums. Using an original panel survey conducted shortly before and after the 2018 abortion referendum in Ireland, I demonstrate the presence of the gendered effect in voting in referendums: While men reported increased internal political efficacy after voting in the referendum, women did not experience any meaningful change, even though the issue magnified women's psychological engagement with the vote. My findings suggest that differences in psychological dispositions between men and women create gendered reactions to citizen experience in the political arena.
Political institutions can be transparent or secret. If they are transparent, then we have access to information about how agents act within them. If they are secret, then we do not have access to this information. The presence and extent of transparency has tremendous impact on how political institutions function. The purpose of this article is to offer a brief overview of what political philosophers have thus far had to say about transparency as it pertains to political institutions. In doing so, I hope to connect philosophical questions about transparency to relevant social scientific work and to highlight areas where more work needs to be done.
Beleid gericht op het behartigen van publieke zaken zal in de huidige marktsamenwerking op een bredere leest moeten worden geschoeid dan die waarop het marktwerkingsbeleid werd ontworpen. Bedrijven en maatschappelijke organisaties zullen daarbij meer dan nu hun verantwoordelijkheid moeten nemen. Dat betoogt de WRR in zijn rapport Publieke zaken in de marktsamenleving (rapport nr. 87, 2012).
How can governments get individuals and firms to pay taxes, especially given increasing tax base erosion via tax evasion, tax avoidance, and money laundering? In this paper we discuss the many different perspectives to explain why people pay-and do not pay-their taxes, especially perspectives based on "responsive regulation," and we use then these perspectives to suggest policies that governments may use to improve tax collections. We first describe an approach that is based on a single individual pursuing a single motivation by choosing a single method (tax evasion) and operating in a single country. This perspective has generated important insights, but it nonetheless has significant limitations. As a result, we then argue that this perspective must be expanded to include additional actors in the field, all pursuing additional motivations. We also expand our discussion to include additional methods of tax base erosion like tax avoidance and money laundering, as well as additional countries. We argue that explaining behavior and then devising appropriate policies requires incorporating all of these additional considerations. We also discuss the likely impact of technological innovations both on the ability of governments to collect taxes and on the ability of private agents to reduce their taxes. An important contribution of our paper is that we simulate the effects of all of these expansions to the basic model using a novel agent-based model that is fully grounded in theory and calibrated for 33 European economics. We use this model to simulate the impacts over time of various reforms, especially reforms that implement international information-sharing programs, by comparing tax base erosion in the absence of these reforms to erosion in their presence. Our simulation results demonstrate the importance of using a fully specified theoretical model that goes well beyond the standard economics of crime approach when considering the effects of government policy innovations. We conclude with recommendations that can in principle reduce tax base erosion via evasion, avoidance, and money laundering in the current multi-dimensional environment as derived from the responsive regulation framework. However , these recommendations require a firm commitment from governments to their tax administrations, and these recommendations also cannot be introduced unilaterally by a single country but require international cooperation, especially via information sharing across borders.
This paper reviews the points of continuity and change between Sugden’s new book and his classic from the 1980s, The Political Economy of Welfare, Rights and Cooperation. It argues that while his new responses to the ‘nudging’ revolution and rising inequality have sharpened his argument for, respectively, the economist as ‘contractarian’ adviser to citizenry model and his defence of the market as an institution of mutual benefit, the introduction of Adam Smith’s concept of ‘mutual sympathy’ is double-edged. It fills a psychological gap in Hume that is important for ‘contractarian’ proposals to citizenry, but it also suggests we might plausibly be interested in something more than mutual benefit when deciding what rules to be regulated by.
Postprint. Please cite as: Leibrecht, Markus and Thomas Rixen (2010) Double Tax Avoidance and Tax Competition for Mobile Capital, in: Martin Zagler (Ed.): International Tax Coordination. An Interdisciplinary Perspective on Virtues and Pitfalls, Routledge, 61-97. https://doi.org/10.4324/9780203849026
One of the most widely expressed arguments against tax avoidance is that it is immoral. In this paper our aim is to study to which extent tax payers avoidance behaviour is shaped by social norms. We study the direct effect on tax avoidance and evasion and how they interact with the salience of moral concerns and rule following. We find a weak correlation between rule-following and avoidance and a strong and robust correlation between rule-following and evasion. This effect persists even after we control for treatment, risk preference, demographics, and session fixed effects. We find no effect on tax avoidance of how justified the redistribution through taxation seems to be. We experimentally manipulate empirical and normative expectations and find a strong effect of expectations about others behaviour indicating a strong conditional cooperative element in tax avoidance behaviour. When we provide either empirical or normative information, we find normative information to have a stronger effect. However, when we provide subjects with conflicting information on both, empirical expectations seem to dominate.
The objective of this paper is to exanimate the preferences of consumer goods of collective consumption or willingness to pay for consumption of the goods which brings them benefits and from consumption of which they cannot be excluded ("public goods") and to test the validity of free rider theory. Theoretical framework is based on a critical analysis of mainstream economics theories dealing with public goods as market failure. Methodological framework is determined by experimental economy and partial outcomes of realized public goods experiments. Own economic experiment tests the research question on rate of willingness to pay for public goods and the factors affecting this willingness. More than 60 % of consumers voluntarily pay for public goods consumption. The consumer's gender, education and obtained utility affect the willingness to pay for public goods.
Explicit economic incentives designed to increase contributions to public goods and to promote other pro-social behavior sometimes are counterproductive or less effective than would be predicted among entirely self-interested individuals. This may occur when incentives adversely affect individuals’ altruism, ethical norms, intrinsic motives to serve the public, and other social preferences. The opposite also occurs—crowding in — though it appears less commonly. © 2013, Russian Presidental Academy of National Economy and Public Administration. All rights reserved.
The cooperative compliance model that has been adopted by the Australian Taxation Office (ATO) to improve voluntary compliance sets out the proposed regulatory action of the ATO in response to the motivational posture of the taxpayer. When there is a dispute between the ATO and a taxpayer, the trust that the ATO has engendered in the taxpayer is purported to convince the taxpayer to comply voluntarily. This article argues that the cooperative compliance model is too narrow to achieve further improvements in voluntary tax compliance and that tax administration in Australia needs to be expanded to include the effects of political participation and fiscal exchange. This article proposes that tax compliance be modelled as a dual dynamic participation mechanism that gives primacy to the role that taxpayers have in voluntary tax compliance. In this mechanism, taxpayers participate in the democratic process in order to influence the government's policies and pay taxes in order to fund the democratically-approved public goods and services. Taxpayers then evaluate the
public goods and services provided by government and increase or decrease their
tax compliance behaviour and their participation in politics in the next tax period in
response. Taxpayers and other citizens also change their levels of political participation
in response to a number of cues that are external to the model. Therefore, to improve
voluntary compliance beyond existing levels, the whole of government must bear
responsibility for it by striving to provide public goods and services that citizens
need and prefer as well as mobilise citizens to increase their participation in politics.
In addition, the responsibility for voluntary tax compliance rests with the entire
community since citizens must be prepared to take up opportunities to participate
in politics so that the likelihood of receiving the desired and necessary goods and
services in an efficient and effective manner is increased.
The aim of this article is the justification for the benefits of tax control in modern conditions of society development, based simultaneously on coercion, service, credibility and partnership. The study includes econometric estimates based on empirical data. An institutional and delictual approach is used along with methods of data processing and analysis. The source of data was the survey results of 1600 respondents from 153 municipalities of Russia as well as Russia State statistical data authorities and the World Bank data. This article considers a theoretical basis for existent strategies of tax control, tax compliance. The specifics and benefits for the integrated strategy, moral factors involved, are being revealed. It is focused on state tax risks management based on partnership relations. The results have shown a close relationship between tax morale and shadow economy level as an indicator for tax compliance (based on correlation, regression), which is confirmed by priority and potential of the proposed strategy. The main tools for the forming of partnership relationships in tax matters are proposed. The efficiency of this strategy is shown by a comparison of gains and losses. © 2018 Universidad Nacional Autónoma de México, Facultad de Contaduría y Administración
The technique of unobserved variables is used to estimate the relative size and development time of the hidden economy of OECD countries. The burdens of taxation and regulations and the tax morality turn out to be statistically significant determinants. At the end of the Scandinavian and Benc(lux) countries are expected to have a relatively large, and Japan and Switzerland a relatively small hidden economy. Canada and the United States are rank in the middle. The size of all hidden sectors is estimated to have increased in the period 1960–1973 relative to officially measured GNP.
Voter participation is viewed as a collective action problem overcome chiefly by means of “solidary” and “purposive” selective incentives in the contemporary United States rather than by material incentives. It is argued that these incentives are primarily in the form of civic or societal norms rather than special interest norms associated with partisan or group loyalties as in Uhlaner's (1986) model. The emphasis on civic norms is supported by positive correlations between turnout and other socially cooperative behaviors such as responding to the census, participating in parent-teacher associations, and giving to charities. Data on interpersonal pressures to vote are found to support the hypothesis that “enforcement” of voting norms via social sanctions significantly enhances turnout. The American turnout decline is interpreted in terms of a weakening of social ties adversely affecting the socialization and enforcement of norms responsible for generating civic participation.
A causal model of relationships between structural properties of states, civic culture attitudes of the general public, and change in level of democracy is tested with cross-national data. The model permits inferences about the possibility of unidirectional or reciprocal causation between civic culture attitudes and democracy, controlling for macrosocietal variables such as economic development, income inequality, and subcultural pluralism. Most civic culture attitudes do not have any significant impact on change in democracy. One of them, interpersonal trust, appears clearly to be an effect rather than a cause of democracy. The exception is the percentage of the general public that prefers gradual reform of society instead of revolutionary change or intransigent defense of the status quo. Support for gradual reform has a positive impact on change in democracy, and it is unrelated to a country's years of continuous democracy—findings that support the hypothesis of a unidirectional civic culture effect on democracy.
Compared with other societies, the United States makes unusually extensive use of adversary institutions for resolving public conflicts-that is, institutions where the job of advocates is to present for a third party the strongest possible case for their own point of view and where responsibility for actual political choice is then left to the third party. This article presents a case for placing greater reliance on “cooperationist institutions,” that is, ones where parties talk with each other rather than to a third party and where the parties attempt to reach agreement among themselves, acceptable to most or all the participants, about the issue in question. The case for cooperationist institutions is argued in terms of the effects of such an institutional design on the development of public spirit among participants in the policymaking process. The article also considers objections against cooperationist institutions and concludes by making some suggestions about the concrete forms that such institutions might take in the United States.
Beyond prices and regulations, a third motivation influences human behavior: intrinsic motivation. Under identifiable conditions, rational individuals replace their intrinsic by extrinsic motivation when prices and regulations are imposed from the outside ("crowding-out effect"). Conversely, policy instruments that acknowledge intrinsic motivation and extend actors' self-determination "crowd-in" intrinsic motivation. Empirical studies support these psychological effects. Copyright 1992 by WWZ and Helbing & Lichtenhahn Verlag AG