Have a personal or library account? Click to login
Tax Compliance among Managers: Evidence from Randomized Audits1 Cover

Tax Compliance among Managers: Evidence from Randomized Audits1

By: Thomas Lange and  Anne May Melsom  
Open Access
|May 2025

References

  1. Allingham, Michael G., and Agnar Sandmo, 1972. “Income Tax Evasion: A Theoretical Analysis.” Journal of Public Economics 1 (3–4), 323–338.
  2. Alm, James, 2019a. “Tax Compliance and Administration.” in Bartley W. and Richardson, James A. (eds.) Handbook on Taxation, Hildreth, 741–768. Routledge, New York.
  3. Alm, James, 2019b. “What Motivates Tax Compliance?” Journal of Economic Surveys, 33 (2), 353–388.
  4. Alm, James, John A. Deskins, and Michael McKee. 2006. “Third-party Income Reporting and Income Tax Compliance.” Andrew Young School of Policy Studies Research Paper Series (06-35).
  5. Alm, James, Jorge Martinez-Vazquez, and Chandler McClellan. 2016. “Corruption and Firm Tax Evasion.” Journal of Economic Behavior & Organization, no. 124, 146–163.
  6. Alm, James, Gary H. McClelland, and William D. Schulze. 1992. “Why Do People Pay Taxes?” Journal of Public Economics 48 (1), 21–38.
  7. Andreoni, James, Brian Erard, and Jonathan Feinstein. 1998. “Tax Compliance.” Journal of Economic Literature 36 (2), 818–860.
  8. Ashby, Julie S., Paul Webley, and Alexander S. Haslam. 2009. “The Role of Occupational Taxpaying Cultures in Taxpaying Behaviour and Attitudes.” Journal of Economic Psychology 30 (2), 216–227.
  9. Atawodi, Ojochogwu Winnie, and Stephen Aanu Ojeka. 2012. “Factors That Affect Tax Compliance among Small and Medium Enterprises (SMEs) in North Central Nigeria.” International Journal of Business and Management 7 (12), 87.
  10. Bakke, Julia T. et al. 2019, Kunnskapskontroller på lønnsområdet: Teknisk rapport. Norwegian Tax Administration, Oslo.
  11. Bastani, Spencer, Thomas Giebe, and Chizheng Miao. 2020. “Ethnicity and Tax Filing Behavior.” Journal of Urban Economics 116, 103215.
  12. Battaglini, Marco, et al. Refining public policies with machine learning: The case of tax auditing. 2022. Refining Public Policies with Machine Learning: The Case of Tax Auditing. National Bureau of Economic Research, Cambridge, MA.
  13. Belloni, Alexandre, et al. 2012. “Sparse Models and Methods for Optimal Instruments with an Application to Eminent Domain.” Econometrica 80 (6), 2369–2429.
  14. Bellows, John, and Edward Miguel. 2006. “War and Institutions: New Evidence from Sierra Leone.” American Economic Review 96 (2), 394–399.
  15. Benjamini, Yoav, and Yosef Hochberg. 1995. “Controlling the False Discovery Rate: A Practical and Powerful Approach to Multiple Testing.” Journal of the Royal Statistical Society: Series B (Methodological) 57 (1), 289–300.
  16. Bird, Robert, and Karie Davis-Nozemack. 2018. “Tax Avoidance as a Sustainability Problem.” Journal of Business Ethics 151, 1009–1025.
  17. Bjørneby, Marie, Annette Alstadsæter, and Telle Kjetil. 2018. “Collusive Tax Evasion by Employers and Employees: Evidence from a Randomized Field Experiment in Norway.” http://dx.doi.org/10.2139/ssrn.3338710.
  18. Bjørneby, Marie, Annette Alstadsæter, and Telle Kjetil. 2021. “Limits to Third-party Reporting: Evidence from a Randomized Field Experiment in Norway.” Journal of Public Economics 203, 104512.
  19. Blackford, Jennifer Urbano. 2017. “Leveraging Statistical Methods to Improve Validity and Reproducibility of Research Findings.” JAMA Psychiatry 74 (2), 119–120.
  20. Bobek, Donna D., Amy M. Hageman, and Charles F. Kelliher. 2013. “Analyzing the Role of Social Norms in Tax Compliance Behavior.” Journal of Business Ethics 115, 451–468.
  21. Bonferroni, Carlo. 1936. “Teoria statistica delle classi e calcolo delle probabilita.” Pubblicazioni del R Istituto Superiore di Scienze Economiche e Commericiali di Firenze 8, 3–62.
  22. Boning, William C., et al. 2020. “Heard It through the Grapevine: The Direct and Network Effects of a Tax Enforcement Field Experiment on Firms.” Journal of Public Economics 190, 104261.
  23. Bornman, Marina. 2015. “The Determinants and Measurement of Trust in Tax Authorities as a Factor Influencing Tax Compliance Behaviour.” Journal of Economic and Financial Sciences 8 (3), 773–790.
  24. Braithwaite, Valerie, and Eliza Ahmed. 2005. “A Threat to Tax Morale: The Case of Australian Higher Education Policy.” Journal of Economic Psychology 26 (4), 523–540.
  25. Broadhurst, David, et al. 1997. “Genetic Algorithms as a Method for Variable Selection in Multiple Linear Regression and Partial Least Squares Regression, with Applications to Pyrolysis Mass Spectrometry.” Analytica Chimica Acta 348 (1–3), 71–86.
  26. Bø, Erlend E., Joel Slemrod, and Thor O. Thoresen. 2015. “Taxes on the Internet: Deterrence Effects of Public Disclosure.” American Economic Journal: Economic Policy 7 (1), 36–62.
  27. Cateni, Silvia, Valentina Colla, and Marco Vannucci. 2010, “Variable Selection through Genetic Algorithms for Classification Purposes.” In Proceedings of the 10th IASTED International Conference on Artificial Intelligence and Applications, 1, 6–11.
  28. Chalfin, Aaron, et al. 2016. “Productivity and Selection of Human Capital with Machine Learning.” American Economic Review 106 (5), 124–127.
  29. Clarke, Damian, Joseph P. Romano, and Michael Wolf. 2019. “The Romano-Wolf Multiple Hypothesis Correction in Stata.” The Stata Journal 20 (4), 812–843.
  30. Collier, Paul, and Nicholas Sambanis. 2002. “Understanding Civil War: A New Agenda.” Journal of Conflict Resolution 46 (1), 3–12.
  31. Cummings, Ronald G., et al. 2009. “Tax Morale Affects Tax Compliance: Evidence from Surveys and an Artefactual Field Experiment.” Journal of Economic Behavior & Organization 70 (3), 447–457.
  32. DeBacker, Jason, Bradley T. Heim, and Anh Tran. 2015. “Importing Corruption Culture from Overseas: Evidence from Corporate Tax Evasion in the United States.” Journal of Financial Economics 117 (1), 122–138.
  33. Del Giudice, Vincenzo, Pierfrancesco De Paola, and Fabiana Forte. 2017. “Using Genetic Algorithms for Real Estate Appraisals.” Buildings 7 (2), 31.
  34. Dubin, Jeffrey A., and Louis L. Wilde. 1988. “An Empirical Analysis of Federal Income Tax Auditing and Compliance.” National Tax Journal 41 (1), 61–74.
  35. Feinstein, Jonathan S. 1991. “An Econometric Analysis of Income Tax Evasion and Its Detection.” The RAND Journal of Economics 22 (1), 14–35.
  36. Feld, Lars P., and Bruno S. Frey. 2002. “Trust Breeds Trust: How Taxpayers Are Treated.” Economics of Governance 3 (2), 87–99.
  37. Feld, Lars P., and Bruno S. Frey. 2007. “Tax Compliance as the Result of a Psychological Tax Contract: The Role of Incentives and Responsive Regulation.” Law & Policy 29 (1), 102–120.
  38. Feldman, Naomi, and Joel Slemrod. 2009. “War and Taxation: When Does Patriotism Overcome the Free-rider Impulse?” in Martin, I. W., Mehrotra, A. K., & Prasad, M. (Eds.) (2009). The new fiscal sociology: Taxation in comparative and historical perspective, 138–154. Cambridge University Press, Cambridge.
  39. Fellner, Gerlinde, Rupert Sausgruber, and Christian Traxler. 2013. “Testing Enforcement Strategies in the Field: Threat, Moral Appeal and Social Information.” Journal of the European Economic Association 11 (3), 634–660.
  40. Fisman, Raymond, and Edward Miguel, 2007. “Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets” 115 (6), 1020–1048.
  41. Foner, Nancy. 2014. “The Immigrant Family: Cultural Legacies and Cultural Changes” in Suárez-Orozco, M. M., Suárez-Orozco, C., & Qin-Hilliard, D. (Eds.) (2014). The new immigrant and the American family: Interdisciplinary perspectives on the new immigration, 111–124. Routledge, New York.
  42. Fonti, Valeria, and Eduard Belitser. 2017. “Feature Selection Using LASSO.” VU Amsterdam Research Paper in Business Analytics 30, 1–25.
  43. Frey, Bruno S., and Benno Torgler. 2007. “Tax Morale and Conditional Cooperation.” Journal of Comparative Economics 35 (1), 136–159.
  44. Gangl, Katharina, Benno Torgler, and Erich Kirchler. 2016. “Patriotism’s Impact on Cooperation with the State: An Experimental Study on Tax Compliance.” Political Psychology 37 (6), 867–881.
  45. Gleditsch, Nils Petter, et al. 2002. “Armed Conflict 1946-2001: A New Dataset.” Journal of Peace Research 39 (5), 615–637.
  46. Hanno, Dennis M., and George R. Violette. 1996. “An Analysis of Moral and Social Influences on Taxpayer Behavior.” Behavioral Research in Accounting 8, 57–75.
  47. Hansen, Christian, and Yuan Liao. 2019. “The Factor-LASSO and K-step Bootstrap Approach for Inference in High-dimensional Economic Applications.” Econometric Theory 35 (3), 465–509.
  48. Harding, Liliana, and Mihai Mutascu. 2016 “Does migration affect tax revenue in Europe?” No. 2016-08. School of Economics, University of East Anglia, Norwich, UK.
  49. Hausman, Jerry A. 1978. “Specification Tests in Econometrics.” Econometrica: Journal of the Econometric Society, 1251–1271.
  50. Hofmann, Eva, Erik Hoelzl, and Erich Kirchler. 2008. “Preconditions of Voluntary Tax Compliance: Knowledge and Evaluation of Taxation, Norms, Fairness, and Motivation to Cooperate.” Zeitschrift für Psychologie/Journal of Psychology 216 (4), 209–217.
  51. Hofmann, Eva, et al. 2017. “Tax Compliance across Sociodemographic Categories: Meta-analyses of Survey Studies in 111 Countries.” Journal of Economic Psychology 62, 63–71.
  52. Hofstede, Geert. 1984. Culture’s Consequences: International Differences in Work-related Values. Sage, Beverly Hills, CA.
  53. Jahnke, Björn, and Reinhard A. Weisser. 2019. “How Does Petty Corruption Affect Tax Morale in Sub-Saharan Africa? European Journal of Political Economy 60, 101751.
  54. James, Gareth, et al. 2023. An Introduction to Statistical Learning. Springer, Cham.
  55. Jenkins, David G., and Pedro F. Quintana-Ascencio. “A Solution to Minimum Sample Size for Regressions.” PloS One 15 (2), e0229345.
  56. Joulfaian, David. 2000. “Corporate Income Tax Evasion and Managerial Preferences.” Review of Economics and Statistics 82 (4), 698–701.
  57. Kaufmann, Daniel, Aart Kraay, and Massimo Mastruzzi. 2005. Governance Matters IV: Governance Indicators for 1996-2004. World Bank, Washington, DC.
  58. Kirchler, Erich. 2007. The Economic Psychology of Tax Behaviour. Cambridge University Press, Cambridge.
  59. Kleven, Henrik Jacobsen, et al. 2011. “Unwilling or Unable to Cheat? Evidence From a Tax Audit Experiment in Denmark.” Econometrica: Journal of the Econometric Society 79 (3), 651–692. https://doi.org/10.3982/ecta9113.
  60. Kleven, Henrik Jacobsen, et al. 2014. “Migration and Wage Effects of Taxing Top Earners: Evidence from the Foreigners’ Tax Scheme in Denmark.” The Quarterly Journal of Economics 129 (1), 333–378.
  61. Kopczuk, Wojciech, et al. 2016. “Does Tax-collection Invariance Hold? Evasion and the Pass-through of State Diesel Taxes.” American Economic Journal: Economic Policy 8 (2), 251–286.
  62. Kountouris, Yiannis, and Kyriaki Remoundou. 2013. “Is There a Cultural Component in Tax Morale? Evidence from Immigrants in Europe.” Journal of Economic Behavior & Organization 96, 104–119.
  63. Lange, Thomas and Anne May Melsom, 2022. “Påvirker op-pholdstid i Norge etterlevelse hos utenlandske arbeidstakere?” Samfunnsøkonomen 1, 28–39.
  64. Lassen, David Dreyer. 2007. “Ethnic Divisions, Trust, and the Size of the Informal Sector.” Journal of Economic Behavior & Organization 63 (3), 423–438.
  65. Liu, Hsiang-Hsi, and Chorng-Shyong Ong. 2008. “Variable Selection in Clustering for Marketing Segmentation Using Genetic Algorithms.” Expert Systems with Applications 34 (1), 502–510.
  66. Marandu, Edward E., Christian J. Mbekomize, and Alexander N. Ifezue. 2015. “Determinants of Tax Compliance: A Review of Factors and Conceptualizations.” International Journal of Economics and Finance 7 (9), 207–218.
  67. Miguel, Edward, Sebastián M. Saiegh, and Shanker Satyanath. 2011. “Civil War Exposure and Violence.” Economics & Politics 23 (1), 59–73.
  68. Muehlbacher, Stephan, Erich Kirchler, and Herbert Schwarzenberger. 2011. “Voluntary versus Enforced Tax Compliance: Empirical Evidence for the ‘Slippery Slope’ Framework.” European Journal of Law and Economics 32 (1), 89–97.
  69. Mullainathan, Sendhil, and Jann Spiess. 2017. “Machine Learning: An Applied Econometric Approach.” 31 (2), 87–106.
  70. Musimenta, Doreen, et al. 2017. “Tax Compliance of Small and Medium Enterprises: A Developing Country Perspective.” Journal of Financial Regulation and Compliance, 25(2), 149-175.
  71. Nordblom, Katarina, and Jovan Žamac. 2012. “Endogenous Norm Formation over the Life Cycle: The Case of Tax Morale.” Economic Analysis & Policy 42 (2), 153-170.
  72. Pearl, Judea. 2018. “Theoretical Impediments to Machine Learning with Seven Sparks from the Causal Revolution.” arXiv preprint arXiv:1801.04016.
  73. Pereira, Jose Manuel, Mario Basto, and Amelia Ferreira Da Silva. 2016. “The Logistic LASSO and Ridge Regression in Predicting Corporate Failure.” Procedia Economics and Finance 39, 634–641.
  74. Potocky, Miriam, and Mitra Naseh. 2020. Best Practices for Social Work with Refugees and Immigrants. Columbia University Press, New York.
  75. Romano, Joseph P., and Michael Wolf. 2005. “Exact and Approximate Stepdown Methods for Multiple Hypothesis Testing.” Journal of the American Statistical Association 100 (469), 94– 108.
  76. Sable, Sonal, Ankita Porwal, and Upendra Singh. 2017. “Stock Price Prediction Using Genetic Algorithms and Evolution Strategies.” In 2017 International Conference of Electronics, Communication and Aerospace Technology (ICECA) (Vol. 2, pp. 549-553), Athens.
  77. Sakamoto, Yosiyuki, Makio Ishiguro, and Genshiro Kitagawa. 1986. “Akaike Information Criterion Statistics.” Dordrecht, The Netherlands: D. Reidel 81 (10.5555), 26853.
  78. Sefiane, Slimane, and Mohamed Benbouziane. 2012. “Portfolio Selection Using Genetic Algorithm.” Journal of Applied Finance & Banking 2 (4), 143–154.
  79. Snow, Arthur, and Ronald S. Warren. 2005. “Ambiguity about Audit Probability, Tax Compliance, and Taxpayer Welfare.” Economic Inquiry 43 (4), 865–871.
  80. Solon, Gary, Steven J. Haider, and Jeffrey M. Wooldridge. 2015. “What Are We Weighting for?” Journal of Human Resources 50 (2), 301–316.
  81. Statistics Norway, 2022. https://www.ssb.no/befolkning/folketall/statistikk/befolkning, Oslo.
  82. Saad, Natrah. 2014. “Tax Knowledge, Tax Complexity and Tax Compliance: Taxpayers’ View.” Procedia-Social and Behavioral Sciences 109, 1069–1075.
  83. Tittle, Charles R. 1980. Sanctions and Social Deviance: The Question of Deterrence. Praeger, New York.
  84. Tolvi, Jussi. 2004. “Genetic Algorithms for Outlier Detection and Variable Selection in Linear Regression Models. soft computing 8 (8), 527–533.
  85. Torgler, Benno. 2004. Tax Morale, Trust and Corruption: Empirical Evidence from Transition Countries (No. 2004-05). CREMA Working Paper, Basel.
  86. Torgler, Benno. 2007. Tax Compliance and Tax Morale: A Theoretical and Empirical Analysis. Edward Elgar, Cheltenham, UK.
  87. Torgler, Benno, et al. 2008. “Causes and Consequences of Tax Morale: An Empirical Investigation.” Economic Analysis and Policy 38 (2), 313–339.
  88. Transparency International, 2019. Corruption Perceptions Index 2018: Score Timeseries since 2012, https://www.transparency.org/en/cpi#.
  89. Tsakumis, George T., Anthony P. Curatola, and Thomas M. Porcano. 2007. “The Relation between National Cultural Dimensions and Tax Evasion.” Journal of International Accounting, Auditing and Taxation 16 (2), 131–147.
  90. Watanabe, Sumio. 2013. “A Widely Applicable Bayesian Information Criterion.” Journal of Machine Learning Research 14 (March), 867–897.
  91. Watson, Luke. 2015. “Corporate Social Responsibility, Tax Avoidance, and Earnings Performance.” The Journal of the American Taxation Association 37 (2), 1–21.
  92. Witte, Ann D., and Diane F. Woodbury. 1985. “The Effect of Tax Laws and Tax Administration on Tax Compliance: The Case of the US Individual Income Tax.” National Tax Journal 38 (1), 1–13.
  93. Young, Cristobal, and Charles Varner. 2011. “Millionaire Migration and State Taxation of Top Incomes: Evidence from a Natural Experiment.” National Tax Journal 64 (2), 255–283.
  94. Zhou, Zirui, Qi Zhang, and Anthony Man-Cho So. 2015. “p-Norm Regularization: Error Bounds and Convergence Rate Analysis of First-Order Methods.” In International Conference on Machine Learning, (pp. 1501-1510). PMLR, Hong Kong.
Language: English
Page range: 1 - 29
Submitted on: Oct 24, 2022
Accepted on: Apr 11, 2024
Published on: May 20, 2025
Published by: DJØF Publishing, Nordic Tax Research Council
In partnership with: Paradigm Publishing Services
Publication frequency: 1 issue per year

© 2025 Thomas Lange, Anne May Melsom, published by DJØF Publishing, Nordic Tax Research Council
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.