Exploring the Deep Determinants of Tax Effort

30 Pages Posted: 24 Jul 2019 Last revised: 4 Aug 2019

Date Written: July 22, 2019


The tax effort literature explains cross-country variation in tax revenues using various determinants of tax revenues. To date, this literature has viewed tax effort primarily as a function of current economic and political circumstances; proximate determinants of tax effort. Borrowing from the development economics literature, this paper explores ‘deep determinants’ of tax effort. I consider how geography, formal institutions, and informal institutions influence tax effort in a large cross-section of countries. A theory based on ‘institutional efficiency’ is proposed that may partly explain the poor tax effort in many developing countries.

Keywords: tax effort, deep determinants, geography, institutions

JEL Classification: H20, B52

Suggested Citation

van Oordt, Marius, Exploring the Deep Determinants of Tax Effort (July 22, 2019). Available at SSRN: https://ssrn.com/abstract=3423874 or http://dx.doi.org/10.2139/ssrn.3423874

Marius Van Oordt (Contact Author)

African Tax Institute ( email )

Physical Address Economic and Management Sciences
Pretoria, Gauteng 0002
South Africa

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