Ghost-House Busters: The Electoral Response to a Large Anti Tax Evasion Program

60 Pages Posted: 26 May 2015

See all articles by Lorenzo Casaburi

Lorenzo Casaburi

Stanford Institute for Economic Policy Research

Ugo Troiano

University of Michigan at Ann Arbor - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: May 2015

Abstract

The incentives of political agents to enforce tax collection are key determinants of the levels of compliance. We study the electoral response to the Ghost Buildings program, a nationwide anti-tax evasion policy in Italy that used innovative monitoring technologies to target buildings hidden from tax authorities. The program induced monetary and non-monetary benefits for non-evaders. A one standard deviation increase in town-level program intensity leads to a 4.8 percent increase in local incumbent reelection rates. In addition, these political returns are higher in areas with lower tax evasion tolerance and with higher efficiency of public good provision, implying complementarity among enforcement policies, the underlying tax culture, and the quality of the government.

Suggested Citation

Casaburi, Lorenzo and Troiano, Ugo, Ghost-House Busters: The Electoral Response to a Large Anti Tax Evasion Program (May 2015). NBER Working Paper No. w21185. Available at SSRN: https://ssrn.com/abstract=2610462

Lorenzo Casaburi (Contact Author)

Stanford Institute for Economic Policy Research ( email )

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Ugo Troiano

University of Michigan at Ann Arbor - Department of Economics ( email )

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Ann Arbor, MI 48109-1220
United States

HOME PAGE: http://sites.google.com/a/umich.edu/troiano

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