Quantifying Loss-Averse Tax Manipulation

• 成果类型: Article
• 署名作者: Rees-Jones, Alex
• 署名单位: University of Pennsylvania; National Bureau of Economic Research
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdx038
• 发表日期: 2018
• 页码: 1251-1278
• 关键词: reference-dependent preferences; expected-utility-theory; prospect-theory; ECONOMICS; income; RISK; evasion; determinants; expectations; attitudes

摘要

This article presents evidence that loss aversion affects taxpayers as they file their annual tax returns, and presents a framework for estimating the policy impact of this psychological phenomenon. In my theoretical framework, taxpayers manipulate the money paid to the tax authority through avoidance and evasion activities. When taxpayers face the prospect of owing the tax authority money on tax day, loss aversion generates the perception of a greater marginal utility of tax reduction and therefore motivates greater pursuit of tax reduction activities. Applying a bunching-based identification strategy to U.S. tax return data, I estimate that taxpayers facing a payment on tax day reduce their tax liability by $34 more than taxpayers owed a refund.