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Taxpayer search for information: implications for rational attention

Hoopes, Jeffrey L., Reck, Daniel ORCID: 0000-0002-5732-4706 and Slemrod, Joel (2015) Taxpayer search for information: implications for rational attention. American Economic Journal: Economic Policy, 7 (3). pp. 177-208. ISSN 1945-7731

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Identification Number: 10.1257/pol.20140050


We examine data on capital-gains-tax-related information search to determine when and how taxpayers acquire information. We find seasonal increases in information search around tax deadlines, suggesting that taxpayers seek information to comply with tax law. Positive correlations between stock market activity and search as well as year-end spikes in information search on capital losses when the market performs poorly suggest that taxpayers seek information for tax planning purposes. Policy changes and news events cause information search. These data suggest that taxpayers are not always fully informed, but that rational attention and exogenous shocks to tax salience drive taxpayer information search.

Item Type: Article
Official URL:
Additional Information: © 2015 American Economic Association
Divisions: Economics
Subjects: H Social Sciences > HB Economic Theory
JEL classification: D - Microeconomics > D1 - Household Behavior and Family Economics > D12 - Consumer Economics: Empirical Analysis
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief
H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H24 - Personal Income and Other Nonbusiness Taxes and Subsidies
H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents > H31 - Household
K - Law and Economics > K3 - Other Substantive Areas of Law > K34 - Tax Law
Date Deposited: 05 Jun 2018 15:38
Last Modified: 10 Jul 2024 04:12

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