One of the principal determinants of an asset's return is its liquidity - the ease with which the asset can be bought and sold. Liquid assets yield a lower return than do otherwise comparable illiquid assets. This Article demonstrates that an income tax alters the tradeoff between asset...

This paper is based on a simple proposition, which we believe but cannot prove: If taxpayers support the way their tax dollars are spent, they are more likely to comply voluntarily and less likely to change their behavior to avoid tax. To show that our claim is plausible, we offer direct...