Tax Morale and Conditional Cooperation

Bruno S. Frey, Benno Torgler
2006 Social Science Research Network  
Frey, Bruno S., and Torgler, Benno-Tax morale and conditional cooperation Why so many people pay their taxes, even though fines and audit probability are low, is a central question in the tax compliance literature. Positing a homo oeconomicus having a refined motivation structure sheds light on this puzzle. This paper provides empirical evidence for the relevance of conditional cooperation, using survey data from 30 West and East European countries. We find a high correlation between perceived
more » ... ax evasion and tax morale. The results remain robust after exploiting endogeneity and conducting several robustness tests. We also observe a strong positive correlation between institutional quality and tax morale.
doi:10.2139/ssrn.900359 fatcat:4h36dqeetnh7noexmthy4bldv4