Experimental Evidence on the Role of Tax Complexity in Investment Decisions
通过口头双向拍卖实验，研究税收复杂性如何影响竞争市场中的投资决策，发现复杂性导致交易价格和数量系统性偏高，降低财富创造并引发财富转移，但市场能部分缓解这些负面效应。
Past behavioral research has demonstrated that complexity in determining one's marginal tax rate can produce systematic decision errors in single-person investment settings in which individuals must choose between investments with different after-tax returns. In this paper, we examine the degree to which such a phenomenon exists when investments are made in competitive markets. More specifically, we conduct a series of oral double-auctions in which buyer profits are taxed and in which we manipulate the complexity required for buyers to arrive at their marginal tax rates. Our two main results are as follows. First, tax complexity leads to systematically (and inefficiently) high trading prices and quantities in these markets, which jointly limits the amount of wealth created, and leads to systematic wealth transfers between market participants and to the taxing authority. Second, these effects generally diminish over the course of the experiment, but do not disappear entirely. The latter result suggests that competitive markets can be effective at mitigating, although not necessarily eliminating, the negative effects of tax complexity on investment decisions.