What Makes a Tax Evader?

Produced by: 
National Bureau of Economic Research
Available from: 
December 2020
Paper author(s): 
Marcelo L. Bergolo
Martin Leites
Ricardo Perez-Truglia
Matias Strehl
Topic: 
Fiscal Policy - Public and Welfare Economics
Year: 
2021

Why do some individuals choose to evade taxes while others do not? One popular view is that some individuals cheat on their taxes because they are more dishonest, selfish, or perceive different social norms. There is, however, little direct evidence on this matter. In collaboration with the national tax agency in Uruguay, we address this question using a combination of surveys and administrative records. Leveraging a unique institutional setting, we measure individual-level evasion choices. We document significant variation in evasion decisions across individuals. For a subsample of 6,078 taxpayers, we use survey questions and incentivized laboratory games to measure traits such as honesty, selfishness, and perceived social norms. We find that these individual traits have some power to predict who evades taxes, but other factors, such as the environment, play a much bigger role.

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Research section: 
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