We study extrinsic and intrinsic motivations for tax compliance in the context of a local church tax in Germany. This tax system has historically relied on zero deterrence so that any compliance at baseline is intrinsically motivated. Starting from this zero deterrence baseline, we implement a field experiment that incentivized compliance through deterrence or rewards. Using administrative records of taxes paid and true tax liabilities, we use these treatments to document that intrinsically motivated compliance is substantial, that a significant fraction of it may be driven by duty-to-comply preferences, and that there is no crowd-out between extrinsic and intrinsic motivations.
Authors
CPP Director, IFS Research Director
Imran is Professor of Economics at University College London and Director of the Centre for the Microeconomic Analysis of Public Policy at the IFS.
Research Associate Princeton University
Henrik is an IFS Research Associate and a Professor of Economics at Princeton University and an Editor of the Journal of Public Economics.
Johannes Rincke
Nadja Dwenger
Journal article details
- DOI
- 10.1257/pol.20150083
- Publisher
- American Economic Association
- JEL
- C93, D64, H26, H71, K34, Z12
- Issue
- Volume 8, No. 3, August 2016, pages 203-32
Suggested citation
Dwenger, N et al. (2016). 'Extrinsic and Intrinsic Motivations for Tax Compliance: Evidence from a Field Experiment in Germany' 8, No. 3(2016), pp.203–32.
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