Firm Decision-Maker Preferences

Last registered on November 15, 2024
View Trial History

Pre-Trial

Trial Information

General Information

Title
Firm Decision-Maker Preferences
RCT ID
AEARCTR-0014807
Initial registration date
November 11, 2024

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
November 15, 2024, 1:45 PM EST

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
Germany
Region

Primary Investigator

Name
Maik Sattelmaier
Affiliation
University of Mannheim
Contact Primary Investigator

Other Primary Investigator(s)

PI Name
Davud Rostam-Afschar
PI Affiliation
University of Mannheim
Contact Investigator
PI Name
Fabian Eble
PI Affiliation
University of Mannheim
Contact Investigator

Additional Trial Information

Status
In development
Start date
2024-11-15
End date
2027-06-30
Keywords
Behavior, Finance & Microfinance, Firms & Productivity
Additional Keywords
tax uncertainty, incentives, recursive utility, timing of resolution of uncertainty, preference elicitation, risk and time preferences
JEL code(s)
H25, D81, D22, H32, D25, B49
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This survey experiment investigates the tax expectations and preferences of German businesses. It aims to assess corporate attitudes towards tax burdens, decision-making in uncertain tax scenarios, and time preferences regarding tax obligations. Through randomized questions on risk aversion, participants choose between guaranteed tax refunds and probabilistic options, illuminating their tolerance for uncertainty. Additional sections explore expected tax liabilities, time preferences for tax payments and refunds, and sensitivity to intertemporal choices under varying return scenarios. The survey provides valuable insights into how businesses anticipate, manage, and strategize around tax obligations, enhancing understanding of corporate tax behavior in Germany.
External Link(s)

Registration Citation

Citation
Eble, Fabian, Davud Rostam-Afschar and Maik Sattelmaier. 2024. "Firm Decision-Maker Preferences." AEA RCT Registry. November 15. https://doi.org/10.1257/rct.14807-1.0
Sponsors & Partners

Sponsors

Partner

Name
uzbonn - Gesellschaft für empirische Sozialforschung und Evaluation
Type
private_company
URL
https://www.uzbonn.de/
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2024-11-18
Intervention End Date
2025-06-30

Primary Outcomes

Primary Outcomes (end points)
- Timing of Tax Assessment
- Risk Aversion
- Tax Expectations for the Next Business Year
- Probability Assessment
- Tax Narratives
- Time Preferences
- Preference for Timing of Resolution of Uncertainty
- Elasticity of Intertemporal Substitution
Primary Outcomes (explanation)
- Timing of Tax Assessment: Average waiting time (in months) for the final tax assessment of a business year.
- Risk Aversion: Sequential staircase choice procedure between a guaranteed hypothetical tax refund (e.g., €10,000) and a probabilistic refund with a 50% chance for a larger amount (e.g., €20,000 or nothing).
- Tax Expectations for the Next Business Year
- Probability Assessment: Probability distribution across expected tax outcomes (most likely, lowest, and highest tax burden estimates)
- Tax Narratives: Open-ended responses regarding challenges or issues related to tax burdens and bureaucratic processes.
- Time Preferences:
(i) Preference for receiving a tax refund (€100,000) immediately or in 12 months.
(ii) Preference for making an additional tax payment (€100,000) immediately or in 12 months.
Willingness to pay to change the timing of (i) a tax refund or (ii) tax payment (to receive it sooner or delay it).
- Preference for timing of resolution of uncertainty: Willingness to pay to eliminate uncertainty about a future (i) tax refund or (ii) tax payment outcome (choices between uncertain refund or payment amounts, with knowledge available in 12 months).
- Elasticity of Intertemporal Substitution: Percentage of planned investments that would be advanced given a hypothetical 10 percentage point increase in investment returns due to tax savings.

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The experiment uses a between subjects design, where the participants are uniformly assigned to one of four groups:
1/4 incentivized firm decision-makers with tax rebate framing
1/4 incentivized firm decision-makers with tax arrears payment framing
1/4 non-incentivized firm decision-makers with tax rebate framing
1/4 non-incentivized firm decision-makers with tax arrears payment framing
Experimental Design Details
Not available
Randomization Method
computer program
Randomization Unit
firm decision-maker
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
1600 firm decision-makers
Sample size: planned number of observations
1600 firm decision-makers
Sample size (or number of clusters) by treatment arms
400 incentivized firm decision-makers with tax rebate framing
400 incentivized firm decision-makers with tax arrears payment framing
400 non-incentivized firm decision-makers with tax rebate framing
400 non-incentivized firm decision-makers with tax arrears payment framing
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Means between two treatments can be detected with a power of 80% and standard deviations of 1 with 400 observations per treatment if the difference between means is at least 0.2.
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Ethics Committee at the University of Mannheim
IRB Approval Date
2024-04-16
IRB Approval Number
EC Mannheim 8/2024
Analysis Plan