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Effects of tax schedules on perceived income distributions
Last registered on March 12, 2019

Pre-Trial

Trial Information
General Information
Title
Effects of tax schedules on perceived income distributions
RCT ID
AEARCTR-0003978
Initial registration date
March 05, 2019
Last updated
March 12, 2019 7:09 AM EDT
Location(s)

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Primary Investigator
Affiliation
University of Warwick
Other Primary Investigator(s)
Additional Trial Information
Status
In development
Start date
2019-03-11
End date
2019-11-01
Secondary IDs
Abstract
Citizens do not usually have accurate information on population income distributions and their income rank position, and hence create beliefs of those measures based on partial information. The literature of income comparison has found that reference income of co-workers and personal network have a significant impact on those perceptions, but other influential factors remain unknown. Are tax schedules used by taxpayers as signals on the actual income distribution? Under certain assumptions on how the government designs tax system, changes on the tax burden applied to different levels of income may be used as signals of the actual income densities. Using an online experiment where workers face different tax systems, I aim to identify the potential impact of the structure of tax scales on perceived income distributions and self income rank.
External Link(s)
Registration Citation
Citation
Diez-Alonso, Daniel. 2019. "Effects of tax schedules on perceived income distributions." AEA RCT Registry. March 12. https://doi.org/10.1257/rct.3978-2.0
Former Citation
Diez-Alonso, Daniel. 2019. "Effects of tax schedules on perceived income distributions." AEA RCT Registry. March 12. https://www.socialscienceregistry.org/trials/3978/history/43177
Sponsors & Partners

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Experimental Details
Interventions
Intervention(s)
Workers perform some tasks to earn income, which is then subject to an income tax system. Questions on perceived distributions and self income rank follow.
Intervention Start Date
2019-03-11
Intervention End Date
2019-07-31
Primary Outcomes
Primary Outcomes (end points)
Perceived Income Distribution; Perceived Income Rank
Primary Outcomes (explanation)
Perceived distributions are elicited by incentivised questions on frequency for different ranges of income. Perceived Income Rank is asked directly.
Secondary Outcomes
Secondary Outcomes (end points)
Perceptions on fairness of tax burden.
Secondary Outcomes (explanation)
Usual type of questions as in regular surveys: "Do you think high earners pay too much / about right / too little taxes?"
Experimental Design
Experimental Design
Workers face different tax systems where the tax burden randomly varies across specific ranges of income. The control group faces the same income schedule in both rounds.
Experimental Design Details
Not available
Randomization Method
Random treatment assigned by the program.
Randomization Unit
Individual and round. Randomization affects to both income used in each round (as a random fraction of income earned performing tasks) and to the tax system faced in each round, by each player.
Was the treatment clustered?
Yes
Experiment Characteristics
Sample size: planned number of clusters
750 people
Sample size: planned number of observations
1500 perceived distributions and income rank (2 rounds per worker)
Sample size (or number of clusters) by treatment arms
There are 3 treatment groups of 150 workers (facing 3 different treatments) and two control groups of 150 workers.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
Humanities & Social Sciences Research Ethics Committee (HSSREC) - University of Warwick
IRB Approval Date
2018-04-23
IRB Approval Number
N/A