The Economic Psychology of Tax Behaviour

Tax evasion is a complex phenomenon which is influenced not just by economic motives but psychological factors as well. Economic-psychological research focuses on individual and social representations of taxation as well as decision-making. In this book, Erich Kirchler assembles research on tax compliance, with a focus on tax evasion, and integrates the findings into a model based on the interaction climate between tax authorities and taxpayers. The interaction climate is defined by citizens\' trust in authorities and the power of authorities to control taxpayers effectively; depending on trust and power, either voluntary compliance, enforced compliance or no compliance are likely outcomes. Featuring chapters on the social representations of taxation, decision-making and self-employed income tax behaviour, this book will appeal to researchers in economic psychology, behavioural economics and public administration.

• Integrates economic and psychological perspectives on tax evasion, unlike the majority of economic studies on this topic • Presents a model to describe tax behaviour, originating from the interaction climate between tax authorities and taxpayers • Features chapters on the social representations of taxation, decision-making, and self-employed income tax behaviour

Foreword Valerie Braithwaite; Preface; 1. Introduction; 2. Tax law, shadow economy and tax non-compliance; 3. Social representations of taxes; 4. Tax compliance decisions; 5. Self-employment and taxpaying; 6. Interaction between tax authorities and taxpayers; 7. Cautious conclusions.

\'This is an interesting, comprehensive and excellent examination of the behavioral aspects of tax compliance and evasion - based on insights from social and cognitive psychology, behavioral economics, and game theory. Kirchler\'s book considers the role of economic incentives in tax compliance, but he also argues that factors such as moral considerations, fairness concerns, and the citizens\' trust in the state play a crucial role. His broad approach makes the book interesting for both tax authorities and social scientists alike.\' Ernst Fehr, Director of the Institute for Empirical Research in Economics, University of Zürich

\'The Economic Psychology of Taxation is often seen by those outside the area as a rather dull business, suitable for anoraks and plodders. But taxation arouses passion, has an impact on people\'s behaviour and has serious repercussions for the wider economy. So it is very pleasing that Kirchler\'s book does full justice to the fascination of people\'s tax behaviour. His account is integrative, insightful and imaginative: it draws on research from a very wide range of social scientific scholarship and from these disparate ingredients creates an intellectual dish that is a real treat. This is a book with real substance; Kirchler is appropriately cautious in his conclusions, but actually there are very practical implications for tax authorities here and plenty of nuggets for social psychologists, economists and socio-legal scholars. Above all, this is a good read - and a good read that should be read.\' Paul Webley, Professor of Economic Psychology, University of London