When Happy People Make Society Unhappy: How Incidental Emotions Affect Compliance Behavior

47 Pages Posted: 3 Nov 2018 Last revised: 28 Jul 2019

See all articles by Martin Fochmann

Martin Fochmann

Free University of Berlin; University of Cologne

Frank Hechtner

Free University of Berlin (FUB)

Erich Kirchler

University of Vienna - Faculty of Psychology

Peter Mohr

Free University of Berlin (FUB)

Date Written: July 25, 2019

Abstract

Emotions have a strong impact on our everyday life in general and on judgment and decision making in particular. Our paper is the first study to show that incidental emotions, i.e., emotions not related to the actual choice problem, influence tax compliance behavior of individuals. A survey with 22,220 German taxpayers and a controlled laboratory experiment with 297 participants provide evidence that positive incidental emotions lead to a lower willingness to comply compared with aversive incidental emotions. Participants in our survey show lower tax compliance attitudes on days associated with positive mood. These findings are supported by the results of a controlled experiment in which incidental emotions are induced with standardized pictures.

Keywords: compliance behavior, emotions, cheating, tax evasion, norms, experimental economics

JEL Classification: C91, D91, H26

Suggested Citation

Fochmann, Martin and Hechtner, Frank and Kirchler, Erich and Mohr, Peter, When Happy People Make Society Unhappy: How Incidental Emotions Affect Compliance Behavior (July 25, 2019). Available at SSRN: https://ssrn.com/abstract=3259071 or http://dx.doi.org/10.2139/ssrn.3259071

Martin Fochmann (Contact Author)

Free University of Berlin ( email )

Thielallee 73
Accounting and Taxation
Berlin, 14195
Germany

University of Cologne ( email )

Albertus-Magnus-Platz
Behavioral Accounting/Taxation/Finance
Cologne, 50923
Germany

HOME PAGE: http://www.taxation.uni-koeln.de/de/team/prof-dr-martin-fochmann/

Frank Hechtner

Free University of Berlin (FUB) ( email )

Garystrasse 21
Berlin, Berlin 14195
Germany

Erich Kirchler

University of Vienna - Faculty of Psychology ( email )

Universitaetsstrasse 7
Vienna, A-1010
Austria
+43 1 42 7747332 (Phone)
+43 1 42 7747339 (Fax)

HOME PAGE: http://homepage.univie.ac.at/erich.kirchler

Peter Mohr

Free University of Berlin (FUB) ( email )

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