Majority wants both punishment for tax evaders and things to go fine for themselves
In most modern states, central institutions are funded by public taxation. This means, however, that tax evaders must also be punished. Once such a system has been established, it is also good for the community: it makes co-existence easier and it helps maintain common standards. However, such advantageous institutions do not come about by themselves. The community must first agree that such a common punishment authority makes sense and decide what powers it should be given. Climate protection is a case in point, demonstrating that this cannot always be achieved. But how can a community agree on sensible institutions and self-limitations?
The Max Planck researchers allowed participants in a modified public goods game to decide whether to pay taxes towards a policing institution with their starting capital. They were additionally able to pay money into a common pot. The total paid in was then tripled and paid out to all participants. If taxes had been paid beforehand, free riders who did not contribute to the group pot were punished by the police. In the absence of taxation, however, there would be no police and the group would run the risk that no-one would pay into the common pot.
Police punishment of both free riders and tax evaders quickly established cooperative behaviour in the experiment. If, however, tax evaders were not punished, the opposite happened and the participants avoided paying taxes. Without policing, there was no longer any incentive to pay into the group pot, so reducing the profits for the group members. Ultimately, each individual thus benefits if tax evaders are punished.
But can participants foresee this development? To find out, the scientists gave the participants a choice: they were now able to choose individually whether they joined a group in which the police also punish tax evaders. Alternatively, they could choose a group in which only those participants who did not pay into the common pot were penalised. Faced with this choice, the majority preferred a community without punishment for tax evaders – with the result that virtually no taxes were paid and, subsequently, that contributions to the group pot also fell.
In a second experimental scenario, the players were instead able to decide by democratic vote whether, for all subsequent rounds, the police should be authorised to punish tax evaders as well as free riders or only free riders. In this case, the players clearly voted for institutions in which tax evaders were also punished. “People are often prepared to impose rules on themselves, but only if they know that these rules apply to everyone,” summarises Christian Hilbe, the lead author of the study. A majority decision ensures that all participants are equally affected by the outcome of the vote. This makes it easier to introduce rules and institutions which, while demanding individual sacrifice, are best for the group.
The Latest on: Democracy
via Google News
The Latest on: Democracy
- Foundations focus their attentions on saving democracyon January 27, 2021 at 10:35 am
Democracy, as President Joe Biden declared in his inaugural speech, survived a barrage of misinformation and an insurrection at the U.S. Capitol to achieve a peaceful transfer of power.
- Some GOP members didn’t accept Biden’s win. What happens when an anti-democratic faction rocks a democracy?on January 27, 2021 at 9:05 am
What happens when a major democratic party has a significant anti-democracy faction? Here’s what we can learn from elsewhere in the world. Our research in Africa and Latin America suggests that ...
- Trump is not a fascist. But that didn't make him any less dangerous to our democracyon January 27, 2021 at 8:01 am
His message: America's Night of the Broken Glass and "selfishness and cynicism," if left unchallenged, could spiral out of control and bring democracy down. Schwarzenegger's message is noble ...
- Graham: lllegitimized impeachment process 'danger to democracy'on January 27, 2021 at 6:11 am
Now, this latest Democratic impeachment Schiff show is now officially dead in the water. It's over. The Senate trial will be conducted as planned, but Democrats do not have anywhere close to what ...
- Zirpoli: Three ideas to strengthen our democracy | COMMENTARYon January 27, 2021 at 2:35 am
America is an ongoing experiment in democracy. But we need to continue to improve the tenants of our democracy, to strengthen and protect it from those who would easily throw it away to hold on to ...
- This Holocaust Memorial Day, Defend Democracy Against White Supremacy | Opinionon January 27, 2021 at 2:17 am
The mainstream political parties of late-1920s and 1930s Germany were only too willing to make concessions to the extreme right. We cannot repeat this fatal mistake.
- Republicans Can Agree to Disagree Over Democracyon January 26, 2021 at 11:11 pm
Because the sedition caucus is embedded within the GOP, other Republicans are the only ones in a position to rein the group in. So far, many who opposed the election challenge and want to hold their ...
- Exclusive: Hong Kong police obtain financial records of arrested democracy activistson January 26, 2021 at 2:21 pm
Hong Kong authorities are scrutinizing the financial records of pro-democracy activists as they crack down on political opposition, according to some activists and a senior bank executive.
- Robert Reich: So CEOs Care About Democracy Now? Give Me a Break | Opinionon January 25, 2021 at 1:49 pm
For years, big corporations have been assaulting democracy with big money, drowning out the voices and needs of ordinary Americans—fueling much of the anger that opened the door to Trump in the first ...
- Our democracy demands an investment in civic educationon January 25, 2021 at 1:00 am
Over the course of nearly six decades, the prioritization of a few subjects (STEM and English language arts, especially) has led to a neglect of American history and civics.
via Bing News