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Issue 5(1), October 2010 -- Paper Abstracts
Girard  (p. 9-22)
Cooper (p. 23-32)
Kunz-Osborne (p. 33-41)
Coulmas-Law (p.42-46)
Stasio (p. 47-56)
Albert-Valette-Florence (p.57-63)
Zhang-Rauch (p. 64-70)
Alam-Yasin (p. 71-78)
Mattare-Monahan-Shah (p. 79-94)
Nonis-Hudson-Hunt (p. 95-106) 



JOURNAL OF APPLIED BUSINESS AND ECONOMICS


Corruption in a Tax Game



Author(s): M. Adnan Kabir, Nazia Choudhury, Liliping

Citation: M. Adnan Kabir, Nazia Choudhury, Liliping, (2020) "Corruption in a Tax Game," Journal of Applied Business and Economics, Vol. 22, Iss.2,  pp. 120-136

Article Type: Research paper

Publisher: North American Business Press

​Abstract:

Our inability to fully predict the complexity of tax behavior stems from the fact that tax evasion, by its very nature, is difficult to observe. The illegality of underreporting taxable income generates the need to maintain secrecy which makes it all the more strenuous to isolate the factors that influence wealth disclosure to tax officials. This paper is an experimental tax game in the context of Bangladesh where a culture of corruption permeates. In particular, this research intends to investigate individuals’ behavior when they have an incentive to partake in corruption by evading taxes through paying bribes. The study
finds that individuals readily choose the financially lucrative and payoff maximizing option of paying bribes, whenever possible, to mitigate the risks of getting caught. We also find that, more often than not, higher tax rate decreases wealth disclosure. Moreover, there is considerable evidence that enforcement of punishment, through the use of audits, acts as a deterrent when it comes to under-reporting wealth.