| By: |
Philipp Chapkovski (National Research University Higher School of Economics, Russian Federation);
Luca Corazzini (Department of Economics, University Of Venice CÃ Foscari);
Valeria Maggian (Department of Economics, University Of Venice CÃ Foscari) |
| Abstract: |
Whistleblowing is a powerful and rather inexpensive instrument to contrast tax
evasion. Despite the deterrent effects on tax evasion, whistleblowing can
reduce trust and undermine agents’ attitude to cooperate with group members.
Yet, no study has investigated the potential spillover effects of
whistleblowing on ingroup cooperation. This paper reports results of a
laboratory experiment in which subjects participate in two consecutive phases
in unchanging groups: a tax evasion game, followed by a generalized gift
exchange game. Two dimensions are manipulated in our experiment: the inclusion
of a whistleblowing stage in which, after observing others’ declared
incomes, subjects can signal other group members to the tax authority, and the
provision of information about the content of the second phase before the tax
evasion game is played. Our results show that whistleblowing is effective in
both curbing tax evasion and improving the precision of tax auditing.
Moreover, we detect no statistically significant spillover effects of
whistleblowing on ingroup cooperation in the subsequent generalized gift
exchange game, with this result being unaffected by the provision of
information about the experimental task in the second phase. Finally, the
provision of information does not significantly alter subjects’ (tax and
whistleblowing) choices in the tax evasion game: thus, knowledge about
perspective ingroup cooperation did not alter attitude towards whistleblowing. |
| Keywords: |
Tax evasion, whistleblowing, ingroup cooperation, spillover effects, laboratory experiment |
| JEL: |
H26 C90 D02 |
| Date: |
2021 |
| URL: |
http://d.repec.org/n?u=RePEc:ven:wpaper:2021:20&r= |