Arguably, for many citizens the perceived expected disutility from sanctions is smaller than the monetary gain from tax evasion. Nevertheless most people pay their taxes most of the time. In a lab experiment, we show that the willingness to pay taxes even absent enforcement is indeed pronounced....

This paper exploits a novel cheating game - the ?Mind Game? - to show how a subtle variation in the rules of the game affects cheating. In both variants of the game, cheating is invisible because subjects make their choices purely in their minds. The only difference rests on the order of the...

Although paying taxes is a key element in a well-functioning civilized society, the understanding of why people pay taxes is still limited. What current evidence shows is that, given relatively low audit probabilities and penalties in case of tax evasion, compliance levels are higher than would...

This paper studies the effect of endogenous audit probabilities on reporting behavior in a face-to-face compliance situation such as at customs. In an experimental setting in which underreporting has a higher expected payoff than truthful reporting we find an increase in compliance of about 80%...

Field evidence suggests that people belonging to the same group often behave similarly, i.e., behaviour exhibits social interaction effects. We conduct an experiment that avoids the identification problem present in the field. Our novel design feature is that each subject simultaneously is a...

Field evidence suggests that people belonging to the same group often behave similarly, i.e., behavior exhibits social interaction effects. We conduct a laboratory experiment that avoids the identification problem present in the field and allows us to study the behavioral logic of social...

We study whether individuals in a face-to-face situation can successfully exert some lying effort to delude others. We exploit data from a laboratory experiment in which participants were asked to assess videotaped statements as being rather truthful or untruthful. The statements are...

We experimentally analyze three anti-tax-evasion mechanisms: (1) prefilling of deductions in tax returns, (2) restricting tax evasion opportunities by either disallowing or (3) limiting the deductibility of expenditures. We find that prefilling compared to blank forms reduces tax evasion....

We investigate the norm of just deserts and its effect on honesty. Just deserts is an essential norm in a market society, and honesty is an important factor in economic and social exchange. In particular, we analyze what happens when the social distributive rules betray the reasonable...

Supporters of left-wing parties typically place more emphasis on redistributive policies than right-wing voters. I investigate whether this difference in tolerating inequality is amplified by suspicious success - achievements that may arise from cheating. Using a laboratory experiment, I...