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Subject ▸ tax morale

The Upsides and Downsides of Generalized Trust: The Mediating Effect of Democratic Institutions

Does generalized trust play a role in the public’s tax compliance? Traditional wisdom claims that generalized trust can affect the public’s compliance with paying taxes by reducing concerns about free-riders and facilitating public goods provision. However, there is little empirical evidence of a statistically significant relationship between generalized trust and tax morale in comparative studies. I argue that the dominant role of generalized trust in tax morale depends on the democratic development of institutions.

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