Alchian and Allen visit the IRS: costly audits and taxpayer compliance
- ASU Author/Contributor (non-ASU co-authors, if there are any, appear on document)
- Mike McKee Ph.D., Professor (Creator)
- Institution
- Appalachian State University (ASU )
- Web Site: https://library.appstate.edu/
Abstract: This article reports on the results from a small-scale investigation of the compliance effects of a costly pre-audit on tax compliance. The tax compliance game is modelled in three parts: a declaration phase, a pre-selection phase with a cost for taxpayers and an audit selection phase where all evaded income is discovered. While the theoretical predictions are ambiguous, the data from a series of laboratory experiments demonstrate that the presence of pre-audit costs leads to lower tax compliance.
Alchian and Allen visit the IRS: costly audits and taxpayer compliance
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Additional Information
- Publication
- Blackwell, C., & McKee, M. (2012). Alchian and Allen visit the IRS: costly audits and taxpayer compliance. Applied Economics Letters, 19(17), 1731-1734. ISSN: 13504851. doi:10.1080/13504851.2012.667541
- Language: English
- Date: 2012
- Keywords
- Tax compliance, Tax evasion, Experiment, Audit cost, Audit