On Mental Accounting and the Flypaper Effect: Quasi-Experimental Evidence from Portugal.
Type
conference speech
Date Issued
2023-03-24
Author(s)
Abstract (De)
Our setup offers a rare opportunity to examine in a real-world setting the prominent puzzle of whether behavioral phenomena can be responsible for flypaper effects in public finance. We study municipal income tax rates in Portugal and find an ideology-specific tax policy response to a change of the default tax rate which, from a neoclassical perspective, should not alter the decision problem of local policymakers. While being at odds with standard economic theory, the quasi-experimental evidence reported in this paper is consistent with an explanation based on mental accounting and classical ideological preferences regarding taxation.
Language
English
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Economic Policy
Event Title
European Public Choice Society
Event Location
Hannover
Event Date
22-25.03.2023
Subject(s)
Eprints ID
270121
File(s)![Thumbnail Image]()
Name
DefaultTax_epcs_March23.pdf
Size
776.85 KB
Format
Adobe PDF
Checksum (MD5)
eb17a5469b21e89df051d0a8ab98606f