1,720,974 research outputs found
Predicting the Deterrence Effect of Tax Audits. A Machine Learning Approach
Full text linkWe apply machine learning methods to the prediction of deterrence effects of tax audits. Based on tax declarations data, we predict the increase in future income declarations after being targeted by an audit. We find that flexible models, such as classification trees and ensemble methods based on them, outperform penalized linear models such as Lasso and ridge regression in predicting taxpayers more likely to increase their declarations after an audit. We show that despite the non-randomness of audits, their specific time structure and the distribution of changes in declared amounts suggest a causal interpretation of our results; that is, our approach detects a heterogeneity in the reaction to a tax audit, rather than just forecasting an unconditional future increase. We find that taxpayers identified by our model will on average increase their declared income by €14,461—the average among all audited taxpayers being €−205. Our approach allows the tax agency to yield significantly larger revenues by appropriately targeting tax audit
Believe it or not: Experimental Evidence on Sunspot Equilibria with Social Networks
No full textModels with sunspot equilibria have long been a topic of interest among economists. It then became an interesting question to ask whether there is empirical support for their existence. One approach to answer this question is through lab experiments. A growing literature has not only successfully reproduced these equilibria in the lab, but also improved our understanding of the conditions under which they might emerge. We study the importance of information provision, and how it affects convergence dynamics. We run a laboratory experiment in which individuals, connected through a network, directly observe the actions of their neighbors as well as aggregate information. By manipulating both the type of information available and the structure of the network, we show that general information about other players' behavior hinders coordination, while information specifically related to the sunspot enhances it
Constrained Network Formation
Full text linkThis study presents a novel framework for the study of endogenous network growth subject to constraints. The literature on strategic network formation analysed the specific case of positive constraints: in the present work, the model is extended to constraints which can be negative and change in time depending on the actions of the agents. A characterisation of stable networks in the static case is provided, and it is proved that finding them is computationally difficult unless specific assumptions are made. The framework can be applied to contexts in which the formation of a link inhibits or implies the formation of another one, typically due to time, space or capacity constraints. Two specific examples are investigated, highlighting the importance of modelling constraints in order to obtain credible simulations and null models: the network of corporate control and the network of citations among scientific papers
Predicting the deterrence effect of tax audits. A machine learning approach
Full text linkWe apply machine learning methods to the prediction of deterrence effects of tax audits. Based on tax declarations data, we predict the increase in future income declarations after being targeted by an audit. We find that flexible models, such as classification trees and ensemble methods based on them, outperform penalized linear models such as Lasso and ridge regression in predicting taxpayers more likely to increase their declarations after an audit. We show that despite the non-randomness of audits, their specific time structure and the distribution of changes in declared amounts suggest a causal interpretation of our results; that is, our approach detects a heterogeneity in the reaction to a tax audit, rather than just forecasting an unconditional future increase. We find that taxpayers identified by our model will on average increase their declared income by 14,461 euro the average among all audited taxpayers being 205 euro. Our approach allows the tax agency to yield significantly larger revenues by appropriately targeting tax audit
The impact of social pressure on tax compliance: A field experiment
No full textWe study the effect of social pressure on tax compliance, focusing on the compliance of shop sellers to the legal obligation of releasing tax receipts for each sale. We carry out a field experiment on bakeries in Italy, where a strong gap exists between the legal obligation and the actual behavior of sellers. Social pressure is manipulated by means of an explicit request for a receipt when not released. We employ an innovative approach to the identification of the treatment effect. We find that a single request for a receipt causes a 17 per cent rise in the probability of a receipt being released for a sale occurring shortly thereafter, causing on average more than two receipts to be released. We also find strong evidence of persistence in compliance decisions
Going Beyond Counting First Authors in Author Co-citation Analysis
Full text linkThe present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation
counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings
are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that
only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into
account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed
When the two ends meet: an experiment on cooperation across the Italian North-South divide
Full text linkWe study the behaviour of individuals with different geographic
origins interacting in a same public good game. We exploit the peculiar composition of the experimental sample to compare the performance of groups where individuals have mixed origins to homogeneous
groups. We find that, despite the absence of any geographic framing, mixed groups exhibit significantly lower contributions. We also
find that cooperation levels differ significantly across geographic
origins, in line with the existing literature. This is explained by a different impact of coordination opportunities, such as communication,
as we show by manipulating them. Our results point towards integration as a crucial aspect for the economic development of intercultural
societies. They also confirm that, rather than being explained just by
the differences in institutions and economic opportunities, the Italian
North-South divide embeds elements of distrust, prejudice and a
consequent path dependence in the level of social capital
Interaction in prevention: a general theory and an application to COVID-19 pandemic
No full textWe study a model introducing interactions in agents' prevention effort, including both the case where agents' efforts reinforce each others and the case where they are conflicting. We characterize best response functions, distinguishing the case of strategic complementarity and the case of strategic substitutability, and determine the features of Nash equilibria in both cases. We find conditions for under- and over-provision of prevention compared to its socially optimal level. Finally, we specialize our model to describe the risk of COVID-19 infection. We show the features of contagion are consistent with the existence of asymmetric equilibria and we provide arguments in favor of policy interventions, such as making face masks mandatory, despite the possibility that they reduce some agents' effort
What exactly is public in a public good game? A lab-in-the field experiment
No full textAre public good games really capturing individuals’ willingness to contribute to real-life public goods? To answer this question, we conducted a lab-in-the-field experiment with communities who own collective goods. In our experiment, subjects voluntarily contribute to a common pool, which can either be subdivided in individual vouchers, as in standard public good games, or used to acquire collective goods, as it happens for real-life public goods. We show that participants’ contributions are larger when the voucher is paid individually, suggesting that individuals’ willingness to contribute to public goods may be overestimated when based on results from laboratory experiments
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