American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
Identifying Tax Compliance from Variation in Tax Policy: Theory and Empirics
American Economic Journal: Economic Policy
(pp. 492–525)
Abstract
Governments increasingly use changes in tax rules to combat evasion. We develop a general approach to point-identify tax compliance along with supply and demand elasticities. Identification requires data on prices and quantities, variation in tax policy, and a demand or supply shifter. We illustrate our approach using data on Airbnb collection agreements, where taxes are enforced by shifting the statutory burden away from hosts and onto renters via the platform. We find that taxes are paid on roughly 0 to 1.6 percent of Airbnb transactions prior to enforcement.Citation
Bibler, Andrew, Laura Grigolon, Keith F. Teltser, and Mark J. Tremblay. 2026. "Identifying Tax Compliance from Variation in Tax Policy: Theory and Empirics." American Economic Journal: Economic Policy 18 (4): 492–525. DOI: 10.1257/pol.20240812Additional Materials
JEL Classification
- H25 Business Taxes and Subsidies including sales and value-added (VAT)
- H26 Tax Evasion and Avoidance
- H71 State and Local Taxation, Subsidies, and Revenue
- K34 Tax Law
- L83 Sports; Gambling; Restaurants; Recreation; Tourism