IDEAS home Printed from https://ideas.repec.org/a/aea/aejapp/v12y2020i2p96-133.html
   My bibliography  Save this article

Compliance Behavior in Networks: Evidence from a Field Experiment

Author

Listed:
  • Francesco Drago
  • Friederike Mengel
  • Christian Traxler

Abstract

This paper studies the spread of compliance behavior in neighborhood networks in Austria. We exploit a field experiment that varied the content of mailings sent to potential evaders of TV license fees. The data reveal a strong treatment spillover: untreated households are more likely to switch from evasion to compliance in response to mailings received by their network neighbors. Digging deeper into the properties of the spillover, we find that it is concentrated among close neighbors of the targets and increases with the treated households' diffusion centrality. Local concentration of equally treated households implies a lower spillover.

Suggested Citation

  • Francesco Drago & Friederike Mengel & Christian Traxler, 2020. "Compliance Behavior in Networks: Evidence from a Field Experiment," American Economic Journal: Applied Economics, American Economic Association, vol. 12(2), pages 96-133, April.
  • Handle: RePEc:aea:aejapp:v:12:y:2020:i:2:p:96-133
    DOI: 10.1257/app.20170690
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/app.20170690
    Download Restriction: no

    File URL: https://www.aeaweb.org/doi/10.1257/app.20170690.data
    Download Restriction: no

    File URL: https://www.aeaweb.org/doi/10.1257/app.20170690.appx
    Download Restriction: no

    File URL: https://www.aeaweb.org/doi/10.1257/app.20170690.ds
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.

    File URL: https://libkey.io/10.1257/app.20170690?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Annette Alstadsæter & Wojciech Kopczuk & Kjetil Telle, 2019. "Social networks and tax avoidance: evidence from a well-defined Norwegian tax shelter," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(6), pages 1291-1328, December.
    2. Charles F. Manski, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(3), pages 531-542.
    3. Markus Mobius & Tuan Phan & Adam Szeidl, 2015. "Treasure Hunt: Social Learning in the Field," CEU Working Papers 2015_2, Department of Economics, Central European University.
    4. Guido W. Imbens & Jeffrey M. Wooldridge, 2009. "Recent Developments in the Econometrics of Program Evaluation," Journal of Economic Literature, American Economic Association, vol. 47(1), pages 5-86, March.
    5. Lori Beaman & Ariel BenYishay & Jeremy Magruder & Ahmed Mushfiq Mobarak, 2021. "Can Network Theory-Based Targeting Increase Technology Adoption?," American Economic Review, American Economic Association, vol. 111(6), pages 1918-1943, June.
    6. Benjamin A. Olken, 2007. "Monitoring Corruption: Evidence from a Field Experiment in Indonesia," Journal of Political Economy, University of Chicago Press, vol. 115(2), pages 200-249.
    7. Vivi Alatas & Abhijit Banerjee & Arun G. Chandrasekhar & Rema Hanna & Benjamin A. Olken, 2016. "Network Structure and the Aggregation of Information: Theory and Evidence from Indonesia," American Economic Review, American Economic Association, vol. 106(7), pages 1663-1704, July.
    8. Allcott, Hunt, 2011. "Social norms and energy conservation," Journal of Public Economics, Elsevier, vol. 95(9-10), pages 1082-1095, October.
    9. Patrick Bayer & Stephen L. Ross & Giorgio Topa, 2008. "Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 1150-1196, December.
    10. Markus Mobius & Tanya Rosenblat, 2014. "Social Learning in Economics," Annual Review of Economics, Annual Reviews, vol. 6(1), pages 827-847, August.
    11. Lori Beaman & Jeremy Magruder, 2012. "Who Gets the Job Referral? Evidence from a Social Networks Experiment," American Economic Review, American Economic Association, vol. 102(7), pages 3574-3593, December.
    12. Gerlinde Fellner & Rupert Sausgruber & Christian Traxler, 2013. "Testing Enforcement Strategies In The Field: Threat, Moral Appeal And Social Information," Journal of the European Economic Association, European Economic Association, vol. 11(3), pages 634-660, June.
    13. Abhijit Banerjee & Arun G Chandrasekhar & Esther Duflo & Mathew O. Jackson, 2014. "Gossip: Identifying Central Individuals in a Social Network," Working Papers id:5925, eSocialSciences.
    14. Jadbabaie, Ali & Molavi, Pooya & Sandroni, Alvaro & Tahbaz-Salehi, Alireza, 2012. "Non-Bayesian social learning," Games and Economic Behavior, Elsevier, vol. 76(1), pages 210-225.
    15. David Marmaros & Bruce Sacerdote, 2006. "How Do Friendships Form?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(1), pages 79-119.
    16. Attila Ambrus & Markus Mobius & Adam Szeidl, 2014. "Consumption Risk-Sharing in Social Networks," American Economic Review, American Economic Association, vol. 104(1), pages 149-182, January.
    17. Craig E. Landry & Andreas Lange & John A. List & Michael K. Price & Nicholas G. Rupp, 2006. "Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(2), pages 747-782.
    18. Matthew O. Jackson & Tomas Rodriguez-Barraquer & Xu Tan, 2012. "Social Capital and Social Quilts: Network Patterns of Favor Exchange," American Economic Review, American Economic Association, vol. 102(5), pages 1857-1897, August.
    19. Leonardo Bursztyn & Florian Ederer & Bruno Ferman & Noam Yuchtman, 2014. "Understanding Mechanisms Underlying Peer Effects: Evidence From a Field Experiment on Financial Decisions," Econometrica, Econometric Society, vol. 82(4), pages 1273-1301, July.
    20. Allcott, Hunt, 2011. "Social norms and energy conservation," Journal of Public Economics, Elsevier, vol. 95(9), pages 1082-1095.
    21. Jing Cai & Alain De Janvry & Elisabeth Sadoulet, 2015. "Social Networks and the Decision to Insure," American Economic Journal: Applied Economics, American Economic Association, vol. 7(2), pages 81-108, April.
    22. Timothy G. Conley & Christopher R. Udry, 2010. "Learning about a New Technology: Pineapple in Ghana," American Economic Review, American Economic Association, vol. 100(1), pages 35-69, March.
    23. Bruhin, Adrian & Goette, Lorenz & Haenni, Simon & Jiang, Lingqing, 2020. "Spillovers of prosocial motivation: Evidence from an intervention study on blood donors," Journal of Health Economics, Elsevier, vol. 70(C).
    24. Jackson Matthew O. & Rogers Brian W., 2007. "Relating Network Structure to Diffusion Properties through Stochastic Dominance," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 7(1), pages 1-16, February.
    25. Benjamin Golub & Matthew O. Jackson, 2012. "How Homophily Affects the Speed of Learning and Best-Response Dynamics," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1287-1338.
    26. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-877, October.
    27. Peter Kuhn & Peter Kooreman & Adriaan Soetevent & Arie Kapteyn, 2011. "The Effects of Lottery Prizes on Winners and Their Neighbors: Evidence from the Dutch Postcode Lottery," American Economic Review, American Economic Association, vol. 101(5), pages 2226-2247, August.
    28. Peter M. DeMarzo & Dimitri Vayanos & Jeffrey Zwiebel, 2003. "Persuasion Bias, Social Influence, and Unidimensional Opinions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 909-968.
    29. repec:hal:spmain:info:hdl:2441/78vacv4udu92eq3fec89svm9uv is not listed on IDEAS
    30. Yann Algan & Quoc-Anh Do & Nicolò Dalvit & Alexis Le Chapelain & Yves Zenou, 2015. "How Social Networks Shape Our Beliefs: A Natural Experiment among Future French Politicians," SciencePo Working papers Main hal-03459820, HAL.
    31. George A. Akerlof, 1980. "A Theory of Social Custom, of which Unemployment may be One Consequence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(4), pages 749-775.
    32. Harrison Hong & Jeffrey D. Kubik & Jeremy C. Stein, 2005. "Thy Neighbor's Portfolio: Word‐of‐Mouth Effects in the Holdings and Trades of Money Managers," Journal of Finance, American Finance Association, vol. 60(6), pages 2801-2824, December.
    33. Berger, Melissa & Fellner-Röhling, Gerlinde & Sausgruber, Rupert & Traxler, Christian, 2016. "Higher taxes, more evasion? Evidence from border differentials in TV license fees," Journal of Public Economics, Elsevier, vol. 135(C), pages 74-86.
    34. Raj Chetty & John N. Friedman & Emmanuel Saez, 2013. "Using Differences in Knowledge across Neighborhoods to Uncover the Impacts of the EITC on Earnings," American Economic Review, American Economic Association, vol. 103(7), pages 2683-2721, December.
    35. Abhijit Banerjee & Arun G Chandrasekhar & Esther Duflo & Matthew O Jackson, 2019. "Using Gossips to Spread Information: Theory and Evidence from Two Randomized Controlled Trials," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 86(6), pages 2453-2490.
    36. Nicky J. Welton & Howard H. Z. Thom, 2015. "Value of Information," Medical Decision Making, , vol. 35(5), pages 564-566, July.
    37. Edward Miguel & Michael Kremer, 2004. "Worms: Identifying Impacts on Education and Health in the Presence of Treatment Externalities," Econometrica, Econometric Society, vol. 72(1), pages 159-217, January.
    38. Dina Pomeranz, 2015. "No Taxation without Information: Deterrence and Self-Enforcement in the Value Added Tax," American Economic Review, American Economic Association, vol. 105(8), pages 2539-2569, August.
    39. Sergio Currarini & Matthew O. Jackson & Paolo Pin, 2009. "An Economic Model of Friendship: Homophily, Minorities, and Segregation," Econometrica, Econometric Society, vol. 77(4), pages 1003-1045, July.
    40. Johannes Rincke & Christian Traxler, 2011. "Enforcement Spillovers," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1224-1234, November.
    41. Arun G. Chandrasekhar & Horacio Larreguy & Juan Pablo Xandri, 2015. "Testing Models of Social Learning on Networks: Evidence from a Lab Experiment in the Field," NBER Working Papers 21468, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bonan, Jacopo & Battiston, Pietro & Bleck, Jaimie & LeMay-Boucher, Philippe & Pareglio, Stefano & Sarr, Bassirou & Tavoni, Massimo, 2021. "Social interaction and technology adoption: Experimental evidence from improved cookstoves in Mali," World Development, Elsevier, vol. 144(C).
    2. Jackson, Matthew O. & Zenou, Yves, 2015. "Games on Networks," Handbook of Game Theory with Economic Applications,, Elsevier.
    3. Matthew O. Jackson & Brian W. Rogers & Yves Zenou, 2016. "Networks: An Economic Perspective," Papers 1608.07901, arXiv.org.
    4. Bryan S. Graham, 2019. "Network Data," Papers 1912.06346, arXiv.org.
    5. Emerick, Kyle & Kelley, Erin & De Janvry, Alain & Sadoulet, Elisabeth, 2019. "Endogenous Information Sharing and the Gains from Using Network Information to Maximize Technology Adoption," CEPR Discussion Papers 13507, C.E.P.R. Discussion Papers.
    6. Yann Algan & Quoc-Anh Do & Nicolò Dalvit & Alexis Le Chapelain & Yves Zenou, 2015. "How Social Networks Shape Our Beliefs: A Natural Experiment among Future French Politicians," Working Papers hal-03459820, HAL.
    7. repec:spo:wpmain:info:hdl:2441/78vacv4udu92eq3fec89svm9uv is not listed on IDEAS
    8. repec:hal:spmain:info:hdl:2441/78vacv4udu92eq3fec89svm9uv is not listed on IDEAS
    9. Arun Advani & Bansi Malde, 2014. "Empirical methods for networks data: social effects, network formation and measurement error," IFS Working Papers W14/34, Institute for Fiscal Studies.
    10. Bryan S. Graham, 2019. "Network Data," CeMMAP working papers CWP71/19, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    11. Matthew O. Jackson & Brian W. Rogers & Yves Zenou, 2017. "The Economic Consequences of Social-Network Structure," Journal of Economic Literature, American Economic Association, vol. 55(1), pages 49-95, March.
    12. Islam, Asadul & Ushchev, Philip & Zenou, Yves & Zhang, Xin, 2019. "The Value of Information in Technology Adoption," IZA Discussion Papers 12672, Institute of Labor Economics (IZA).
    13. Perez-Truglia, Ricardo & Troiano, Ugo, 2018. "Shaming tax delinquents," Journal of Public Economics, Elsevier, vol. 167(C), pages 120-137.
    14. Yann Algan & Quoc-Anh Do & Nicolò Dalvit & Alexis Le Chapelain & Yves Zenou, 2015. "How Social Networks Shape Our Beliefs: A Natural Experiment among Future French Politicians," Working Papers hal-03459820, HAL.
    15. Philipp Doerrenberg & Andreas Peichl, 2022. "Tax Morale and the Role of Social Norms and Reciprocity - Evidence from a Randomized Survey Experiment," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 78(1-2), pages 44-86.
    16. Leonardo Bursztyn & Florian Ederer & Bruno Ferman & Noam Yuchtman, 2012. "Understanding Peer Effects in Financial Decisions: Evidence from a Field Experiment," NBER Working Papers 18241, National Bureau of Economic Research, Inc.
    17. Di Gioacchino, Debora & Fichera, Domenico, 2020. "Tax evasion and tax morale: A social network analysis," European Journal of Political Economy, Elsevier, vol. 65(C).
    18. Leonardo Bursztyn & Robert Jensen, 2017. "Social Image and Economic Behavior in the Field: Identifying, Understanding, and Shaping Social Pressure," Annual Review of Economics, Annual Reviews, vol. 9(1), pages 131-153, September.
    19. Leonardo Bursztyn & Florian Ederer & Bruno Ferman & Noam Yuchtman, 2014. "Understanding Mechanisms Underlying Peer Effects: Evidence From a Field Experiment on Financial Decisions," Econometrica, Econometric Society, vol. 82(4), pages 1273-1301, July.
    20. Mobarak, Ahmed & Levinsohn, James & Guiteras, Raymond, 2019. "Demand Estimation with Strategic Complementarities: Sanitation in Bangladesh," CEPR Discussion Papers 13498, C.E.P.R. Discussion Papers.
    21. Dur, Robert & Fleming, Dimitry & van Garderen, Marten & van Lent, Max, 2021. "A social norm nudge to save more: A field experiment at a retail bank," Journal of Public Economics, Elsevier, vol. 200(C).
    22. Heitzig, Chris & O’Keeffe-O’Donovan, Rossa, 2024. "Spillover Effects and Diffusion of Savings Groups," World Development, Elsevier, vol. 173(C).

    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejapp:v:12:y:2020:i:2:p:96-133. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.