Society

, Volume 52, Issue 2, pp 155–158 | Cite as

Where is My Money? New Findings in Fiscal Psychology

Social Science and Public Policy

Abstract

The essay outlines selected psychological attitudes towards taxes. We argue that the application of behavioural economics methodology to taxation is more than justified because, in their decision-making, taxpayers seem to be influenced by the perception of taxes rather than solely by their existence. We also discuss several real life examples of how tax salience affects the perception of taxes in various settings. The conclusion points out that the tax non-salience contributes to fiscal illusion, which allows governments to grow.

Keywords

Behavioural economics Fiscal policy Fiscal psychology Salience Taxes 

Further Reading

  1. Chetty, R., Looney, A., & Kroft, K. 2009. Salience and Taxation: Theory and Evidence. American Economic Review, 99(4), 1145–1177. doi: 10.1257/aer.99.4.1145.CrossRefGoogle Scholar
  2. Congdon, W. J., Kling, J. R., & Mullainathan, S. 2009. Behavioral Economics and Tax Policy. National Tax Journal, 62(3), 375–386.Google Scholar
  3. Finkelstein, A. 2009. E-ztax: Tax Salience and Tax Rates. The Quarterly Journal of Economics, 124(3), 969–1010. doi: 10.1162/qjec.2009.124.3.969.CrossRefGoogle Scholar
  4. McCaffery, E. J., & Baron, J. 2006. Thinking about tax. Psychology, Public Policy, and Law, 12(1), 106–135.CrossRefGoogle Scholar
  5. Mullainathan, S., & Shafir, E. 2013. Scarcity: Why Having Too Little Means So Much. London: Penguin Group.Google Scholar
  6. Olsen, A. 2013. The politics of digits: evidence of odd taxation. Public Choice, 154(1–2), 59–73. doi: 10.1007/s11127-011-9807-x.CrossRefGoogle Scholar
  7. Saez, E. 2010. Do Taxpayers Bunch at Kink Points? American Economic Journal: Economic Policy, 2(3), 180–212. doi: 10.1257/pol.2.3.180.Google Scholar

Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  1. 1.Faculty of Social and Economic StudiesJ. E. Purkyne University in Ústí nad LabemÚstí nad LabemCzech Republic
  2. 2.Institute for Behavioral and Economic StudiesPragueCzech Republic

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