IDEAS home Printed from https://ideas.repec.org/p/osf/socarx/e6ds9.html
   My bibliography  Save this paper

Lower Taxes At All Costs? Evidence from a Survey Experiment in Four European Countries

Author

Listed:
  • Bremer, Björn

    (Max Planck Institute for the Study of Societies)

  • Bürgisser, Reto

    (University of Zurich)

Abstract

It is commonly assumed that voters favor lower taxes, which undermines the ability of governments to raise revenues. How does the demand for lower taxes change when it involves fiscal trade-offs? Who supports tax cuts at all costs? We use a survey experiment conducted in four European countries (Germany, Italy, Spain, and the UK) to answer these questions, studying preferences on income taxes, value added taxes (VAT), and top income taxes. The results show that support for income tax and VAT cuts drops profoundly when it implies lower government spending or higher government debt. Lower top income taxes are always unpopular. Both interest and ideology influence preferences, but for cross-pressured people, ideology dominates: high-income voters that are left-wing oppose tax cuts. The results are important because they suggest that a progressive coalition against lower taxes – including low-income voters and the high-income left – is possible.

Suggested Citation

  • Bremer, Björn & Bürgisser, Reto, 2022. "Lower Taxes At All Costs? Evidence from a Survey Experiment in Four European Countries," SocArXiv e6ds9, Center for Open Science.
    • Handle: RePEc:osf:socarx:e6ds9
    DOI: 10.31219/osf.io/e6ds9
    as

    Download full text from publisher

    File URL: https://osf.io/download/63a9d050433f0601c5c8ebb0/
    Download Restriction: no
    File URL: https://libkey.io/10.31219/osf.io/e6ds9?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
    ---><---

    References listed on IDEAS

    as
    1. Lucas Chancel & Thomas Piketty & Emmanuel Saez & Gabriel Zucman, 2021. "World Inequality Report 2022," PSE-Ecole d'économie de Paris (Postprint) halshs-03693233, HAL.
    2. Alesina, Alberto & La Ferrara, Eliana, 2005. "Preferences for redistribution in the land of opportunities," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 897-931, June.
    3. Adi Brender & Allan Drazen, 2008. "How Do Budget Deficits and Economic Growth Affect Reelection Prospects? Evidence from a Large Panel of Countries," American Economic Review, American Economic Association, vol. 98(5), pages 2203-2220, December.
    4. Martin Bisgaard & Rune Slothuus, 2018. "Partisan Elites as Culprits? How Party Cues Shape Partisan Perceptual Gaps," American Journal of Political Science, John Wiley & Sons, vol. 62(2), pages 456-469, April.
    5. Bansak, Kirk & Bechtel, Michael M. & Margalit, Yotam, 2021. "Why Austerity? The Mass Politics of a Contested Policy," American Political Science Review, Cambridge University Press, vol. 115(2), pages 486-505, May.
    6. Lucy Barnes & Timothy Hicks, 2018. "Making Austerity Popular: The Media and Mass Attitudes toward Fiscal Policy," American Journal of Political Science, John Wiley & Sons, vol. 62(2), pages 340-354, April.
    7. Tito Boeri & Axel Börsch-Supan & Guido Tabellini, 2001. "Would you like to shrink the welfare state? A survey of European citizens," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 16(32), pages 08-50.
    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. DiGiuseppe, Matthew & Del Ponte, Alessandro, 2023. "Bottom-Up Sovereign Debt Preferences," SocArXiv wxr67_v1, Center for Open Science.
    2. Barnes, Lucy & Hicks, Timothy, 2018. "All Keynesian Now? Public Support for Countercyclical Government Borrowing," SocArXiv pvdeu, Center for Open Science.
    3. Alpino, Matteo & Asatryan, Zareh & Blesse, Sebastian & Wehrhöfer, Nils, 2022. "Austerity and distributional policy," Journal of Monetary Economics, Elsevier, vol. 131(C), pages 112-127.
    4. Barnes, Lucy & Hicks, Timothy, 2018. "All Keynesian Now? Public Support for Countercyclical Government Borrowing," SocArXiv pvdeu_v1, Center for Open Science.
    5. DiGiuseppe, Matthew & Del Ponte, Alessandro, 2023. "Bottom-Up Sovereign Debt Preferences," SocArXiv wxr67, Center for Open Science.
    6. Ardanaz, Martín & Hübscher, Evelyne & Keefer, Philip & Sattler, Thomas, 2024. "Voter Responses to Fiscal Crisis: New Evidence on Preferences for Fiscal Adjustment in Emerging Markets," IDB Publications (Working Papers) 13473, Inter-American Development Bank.
    7. Robert MacCulloch & Silvia Pezzini, 2010. "The Roles of Freedom, Growth, and Religion in the Taste for Revolution," Journal of Law and Economics, University of Chicago Press, vol. 53(2), pages 329-358, May.
    8. Bernd Hayo & Florian Neumeier, 2017. "Public Attitudes toward Fiscal Consolidation: Evidence from a Representative German Population Survey," Kyklos, Wiley Blackwell, vol. 70(1), pages 42-69, February.
    9. Monika Bütler, 2002. "The Political Feasibility of Increasing the Retirement Age: Lessons from a Ballot on the Female Retirement Age," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 9(4), pages 349-365, August.
    10. Busemeyer, Marius R. & Cattaneo, Maria Alejandra & Wolter, Stefan C., 2010. "Individual policy preferences for vocational versus academic education micro level evidence for the case of Switzerland," MPIfG Discussion Paper 10/11, Max Planck Institute for the Study of Societies.
    11. Peter Backus & Alejandro Esteller-Moré, 2013. "What drives demand for redistribution? An empirical analysis of other-regarding and self-insurance motives," Economics Discussion Paper Series 1325, Economics, The University of Manchester.
    12. Roth, Christopher & Settele, Sonja & Wohlfart, Johannes, 2022. "Beliefs about public debt and the demand for government spending," Journal of Econometrics, Elsevier, vol. 231(1), pages 165-187.
    13. Pfarr Christian & Ulrich Volker, 2011. "Discrete-Choice-Experimente zur Ermittlung der Präferenzen für Umverteilung," Review of Economics, De Gruyter, vol. 62(3), pages 232-262, December.
    14. Christian Pfarr & Andreas Schmid & Morten Raun Mørkbak, 2018. "Modelling Heterogeneous Preferences for Income Redistribution–An Application of Continuous and Discrete Distributions," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(2), pages 270-294, June.
    15. Jante Parlevliet & Massimo Giuliodori & Matthijs Rooduijn, 2023. "Populist attitudes, fiscal illusion and fiscal preferences: evidence from Dutch households," Public Choice, Springer, vol. 197(1), pages 201-225, October.
    16. Hansen, Daniel, 2020. "The effectiveness of fiscal institutions: International financial flogging or domestic constraint?," European Journal of Political Economy, Elsevier, vol. 63(C).
    17. Peter Backus & Alejandro Esteller-Moré, 2014. "Is income redistribution a form of insurance, a public good or both?," Working Papers 2014/33, Institut d'Economia de Barcelona (IEB).
    18. Neustadt, Ilja & Zweifel, Peter, 2010. "Is the Welfare State Sustainable? Experimental Evidence on Citizens' Preferences for Redistribution," MPRA Paper 22233, University Library of Munich, Germany.
    19. Pfarr, Christian, 2012. "Meltzer-Richard and social mobility hypothesis: revisiting the income-redistribution nexus using German choice data," MPRA Paper 43325, University Library of Munich, Germany.
    20. Tyran, Jean-Robert & Sausgruber, Rupert, 2006. "A little fairness may induce a lot of redistribution in democracy," European Economic Review, Elsevier, vol. 50(2), pages 469-485, February.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:osf:socarx:e6ds9. 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: OSF (email available below). General contact details of provider: https://arabixiv.org .

    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.