Sausgruber, Rupert, Tyran, Jean-Robert. 2014. Discriminatory taxes are unpopular - Even when they are efficient and distributionally fair. Journal of Economic Behavior and Organization 108, 463-476.
BibTeX
Abstract
We explore the political acceptance of taxation in commodity markets. Participants in our experiment earn incomes by trading and must collectively choose one of the two tax regimes to raise a given tax revenue. A “uniform tax” (UT) imposes the same tax rate on all markets and is fair in that it yields the same – but low – income to participants in all markets. The “discriminatory tax” (DT) imposes a higher burden on markets with inelastic demand and is therefore efficient but it is also unfair in that incomes are unequal across markets. We find that DT is unpopular, as predicted. Surprisingly, however, DT remains unpopular when they are both efficient and produce a fair (equal) distribution. We conclude that non-discrimination (equal treatment) is a salient fairness principle in taxation that shapes voting on commodity taxes above and beyond concerns for efficiency and equal distribution.
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Status of publication | Published |
---|---|
Affiliation | WU |
Type of publication | Journal article |
Journal | Journal of Economic Behavior and Organization |
Citation Index | SSCI |
WU Journalrating 2009 | A |
WU-Journal-Rating new | FIN-A, STRAT-A, VW-B, WH-A |
Language | English |
Title | Discriminatory taxes are unpopular - Even when they are efficient and distributionally fair |
Volume | 108 |
Year | 2014 |
Page from | 463 |
Page to | 476 |
Reviewed? | Y |
URL | http://www.sciencedirect.com/science/article/pii/S0167268114000055 |
DOI | http://dx.doi.org/10.1016/j.jebo.2013.12.022 |
Associations
- Projects
- Experimental Investigations of Labor Markets
- People
- Sausgruber, Rupert (Details)
- External
- Tyran, Jean-Robert (University of Copenhagen, Denmark)
- Organization
- Department of Economics (Sausgruber) (Details)
- Department of Economics DP (Details)
- Research Institute for International Taxation FI (Details)
- Research areas (Ă–STAT Classification 'Statistik Austria')
- 5311 Public finance (Details)
- 5325 Political economics (Details)
- 5351 Public economy (Details)