Publication details
A competitive audit selection mechanism with incomplete information
| Authors | |
|---|---|
| Year of publication | 2025 |
| Type | Article in Periodical |
| Magazine / Source | International Tax and Public Finance |
| MU Faculty or unit | |
| Citation | |
| web | https://link.springer.com/article/10.1007/s10797-025-09937-1 |
| Doi | https://doi.org/10.1007/s10797-025-09937-1 |
| Keywords | Tax compliance; Competitive audit; Heterogeneous income; Laboratory experiment |
| Attached files | |
| Description | The literature on experimental tax and regulatory compliance has highlighted significant advantages associated with competitive audit selection mechanisms (ASMs) predicated on differences in estimated undeclared incomes among taxpayers. This paper explores the potential negative consequences of competitive ASMs in situations where authorities lack an unbiased indicator of these differences. Through a laboratory experiment, we demonstrate that asymmetric information between taxpayers and tax authorities can diminish compliance and exacerbate inequality within competitive ASMs. Our findings underscore the need for caution concerning the perceived benefits of competitive ASMs and emphasize the importance of allocating resources to mitigate income heterogeneity among groups subject to competitive audit selection. |
| Related projects: |