Neuroeconomics and Tax: A Literature Review

Year 2023, Issue: 52, 176 - 188, 27.12.2023

Hakan Özdemir

https://doi.org/10.52642/susbed.1345361

Abstract

Developing technology has profoundly affected many fields of science and research methods, as well as changing our lives as a whole. As a reflection of this, sciences such as economics and public finance, which focus on pure rationality, have also taken their share from this change. The development of technologies that scan and display the human body and the more dominant acceptance of the connection of scientific fields such as neurology and psychology with other sciences lead to a paradigm shift, especially in the field of economics. Now, there is a transition process from the concept of homo economicus, which is the basis of the neoclassical view and based on self-interest, to the concept of neuroeconomics, which evaluates that neurological factors can be effective in people's decision-making processes. Neuroeconomics is an interdisciplinary approach that combines cognitive psychology, economics, and neurobiology to study how people make decisions. The main feature of this approach is to prioritize neurological processes while investigating decision-making processes. Some of the tax studies are about taxpayer behaviors and when viewed, they are similar to the approach on which neuroeconomics is based. In this study, information about what the neuroeconomics approach is, its foundations and the methods it uses are given, and evaluations are made about how this approach is used and how it can be used in tax studies.

Keywords

Neuroeconomics, Taxpayer Behaviors, Decision Making, Homo Economicus, Tax Compliance

Nöroekonomi ve Vergi: Literatür İncelemesi

Abstract

Gelişen teknoloji, hayatımızı bir bütün olarak değiştirmekle birlikte birçok bilim alanını ve araştırma yöntemlerini derinden etkilemiştir. Bunun bir yansıması olarak salt rasyonelliğe odaklanan iktisat ve maliye gibi bilimler de bu değişimden payını almıştır. İnsan vücudunu tarayan ve görüntüleyen teknolojilerin gelişmesi ve nöroloji, psikoloji gibi bilim alanlarının diğer bilimlerle olan bağlantısının daha baskın bir şekilde kabul edilmesi, özellikle ekonomi alanında paradigma dönüşümüne yol açmaktadır. Artık neoklasik görüşün temelini oluşturan ve kişisel çıkarı temel alan homo economicus kavramından insanların karar verme süreçlerinde nörolojik faktörlerin etkili olabileceğini değerlendiren nöroekonomi kavramına bir geçiş süreci yaşanmaktadır. Nöroekonomi, insanların nasıl karar verdiklerini incelemek için bilişsel psikoloji, ekonomi ve nörobiyolojiyi birleştiren disiplinlerarası bir yaklaşımdır. Bu yaklaşımın temel özelliği, karar alma süreçlerini araştırırken nörolojik süreçlerin ön planda tutulmasıdır. Vergiye ilişkin çalışmaların bir bölümü mükellef davranışlarını konu almakta ve bakıldığında nöroekonominin temel aldığı yaklaşımla bazı noktalarda benzeşmektedir. Bu çalışmada, nöroekonomi yaklaşımının ne olduğuna, temellerine ve kullandığı yöntemlere ilişkin bilgilere yer verilmiş, bu yaklaşımın nasıl kullanıldığına ve vergi alanındaki çalışmalarda ne şekilde kullanılabileceğine ilişkin değerlendirmelerde bulunulmuştur.

Keywords

Nöroekonomi, Mükellef Davranışları, Karar Verme, Homo Economicus, Vergi Uyumu

References

• Ailon, G. (2020). The Phenomenology of Homo Economicus. Sociological Theory, 38(1), 36-50.
• Allingham, M. G., & Sandmo, A. (1972). Income Tax Evasion: A Theoretical Analysis. Journal of Public Economics, 1(3-4), 323-338.
• Andreoni, J., Erard, B., & Feinstein, J. (1998). Tax Compliance. Journal of economic literature, 36(2), 818-860.
• Ardalan, K. (2018). Behavioral Attitudes toward Current Economic Events: A Lesson from Neuroeconomics. Business Economics, 53(4), 202-208. https://doi.org/10.1057/s11369-018-0089-x
• Aydinonat, N. E. (2010). Neuroeconomics: More Than Inspiration, Less Than Revolution. Journal of Economic Methodology, 17(2), 159–169.
• Bătrâncea, L.-M., & Nichita, R.-A. (2012). A Neuroeconomic Approach of Tax Behavior. Annals of the University of Oradea, Economic Science Series, 21(1), 649–654.
• Baumgartner, T., Heinrichs, M., Vonlanthen, A., Fischbacher, U., & Fehr, E. (2008). Oxytocin Shapes the Neural Circuitry of Trust and Trust Adaptation in Humans. Neuron, 58(4), 639-650.
• Berke, J. D. (2018). What Does Dopamine Mean? Nature Neuroscience, 21(6), 787-793. https://doi.org/10.1038/s41593-018-0152-y
• Bernheim, B. D. (2009). On the Potential of Neuroeconomics: A Critical (but Hopeful) Appraisal. American Economic Journal: Microeconomics, 1(2), 1-41. https://doi.org/10.1257/mic.1.2.1
• Bogacz, R. (2007). Optimal Decision-Making Theories: Linking Neurobiology with Behaviour. Trends in cognitive sciences, 11(3), 118-125.
• Brocas, I., & Carrillo, J. D. (2019). A Neuroeconomic Theory of (Dis) Honesty. Journal of Economic Psychology, 71, 4-12.
• Caldú, X., & Dreher, J. C. (2007). Hormonal and Genetic Influences on Processing Reward and Social Information. Annals of the New York Academy of Sciences, 1118(1), 43-73.
• Camerer, C., Loewenstein, G., & Prelec, D. (2005). Neuroeconomics: How Neuroscience Can Inform Economics. Journal of economic literature, 43(1), 9-64.
• Camerer, C. F. (2003). Strategizing in the Brain. Science, 300(5626), 1673-1675.
• Chorvat, T. (2007). Tax Compliance and the Neuroeconomics of Intertemporal Substitution. National Tax Journal, 60(3), 577-588.
• Constantinescu, M. (2010). Neuroeconomics and Decision Making Process. Theoretical and Practical Research in Economic Fields (TPREF), 1(02), 209-217.
• Coricelli, G., Dolan, R. J., & Sirigu, A. (2007). Brain, Emotion and Decision Making: The Paradigmatic Example of Regret. Trends in cognitive sciences, 11(6), 258-265.
• Dan, O., Wertheimer, E. K., & Levy, I. (2022). A Neuroeconomics Approach to Obesity. Biological Psychiatry, 91(10), 860-868.
• Declerck, C. H., Boone, C., Pauwels, L., Vogt, B., & Fehr, E. (2020). A Registered Replication Study on Oxytocin and Trust. Nature Human Behaviour, 4(6), 646-655. https://doi.org/10.1038/s41562-020-0878-x
• DiMaggio, P., & Goldberg, A. (2018). Searching for Homo Economicus: Variation in Americans’ Construals of and Attitudes toward Markets. Archives Européennes de Sociologie, 59(2), 151-189. https://doi.org/https://doi.org/10.1017/S0003975617000558
• Dolan, R. J., & Sharot, T. (2011). Neuroscience of Preference and Choice: Cognitive and Neural Mechanisms. Academic Press.
• Ebrahimzadeh, A., Garkaz, M., Khozein, A., & Maetoofi, A. (2022). A Novel Machine Learning-Based Approach for Identification of Unrealistic Tax Returns by Eeg Signal Processing. Biomedical Engineering: Applications, Basis and Communications, 34(03), 2250007. https://doi.org/10.4015/s1016237222500077
• Elgun, M. N., Aşıkoğlu, N. O., & Karabıyık, H. Ç. (2018). A Neuroeconomic Approach to the Rationality and Homoeconomicus Concepts and the Research Discussed in the Frontal Lobe, Reptilian Brain and Serotonin Levels Basis. Yönetim Bilimleri Dergisi, 16(31), 109-124.
• Elliott, R., Friston, K. J., & Dolan, R. J. (2000). Dissociable Neural Responses in Human Reward Systems. Journal of neuroscience, 20(16), 6159-6165.
• Fehr, E., & Rangel, A. (2011). Neuroeconomic Foundations of Economic Choice—Recent Advances. Journal of economic perspectives, 25(4), 3-30.
• Franzoni, L. A. (1998). Tax Evasion and Tax Compliance. Available at SSRN 137430, 1-23.
• Fumagalli, R. (2016). Five Theses on Neuroeconomics. Journal of Economic Methodology, 23(1), 77-96. https://doi.org/10.1080/1350178X.2015.1024883
• Glimcher, P. W. (2011). Understanding Dopamine and Reinforcement Learning: The Dopamine Reward Prediction Error Hypothesis. Proceedings of the National Academy of Sciences, 108(supplement_3), 15647-15654.
• Goldberg, T. E., & Weinberger, D. R. (2004). Genes and the Parsing of Cognitive Processes. Trends in cognitive sciences, 8(7), 325-335.
• Gul, F., Pesendorfer, W., & Caplin, A. (2008). The Case for Mindless Economics. The foundations of positive and normative economics: A handbook, 1, 3-42.
• Hardy‐Vallée, B. (2007). Decision‐Making: A Neuroeconomic Perspective. Philosophy Compass, 2(6), 939-953.
• Hausman, D. (2008). Mindless or Mindful Economics: A Methodological Evaluation. The foundations of positive and normative economics: A handbook, 125-155.
• Ji, R., & Zhemin, S. (2018). Eeg Experiment Research on the Effects of Neuroscience-Based Managerial Tax Avoidance on the Firm Value. NeuroQuantology, 16(5). https://doi.org/https://doi.org/10.14704/nq.2018.16.5.1381
• Kahneman, D., & Tversky, A. (1984). Choices, Values, and Frames. American Psychologist, 39, 341-350. https://doi.org/10.1037/0003-066X.39.4.341
• Kosfeld, M., Heinrichs, M., Zak, P. J., Fischbacher, U., & Fehr, E. (2005). Oxytocin Increases Trust in Humans. Nature, 435(7042), 673-676.
• Krajbich, I., Camerer, C., Ledyard, J., & Rangel, A. (2009). Using Neural Measures of Economic Value to Solve the Public Goods Free-Rider Problem. Science, 326(5952), 596-599. http://www.jstor.org/stable/40328898
• Krueger, F., Parasuraman, R., Iyengar, V., Thornburg, M., Weel, J., Lin, M., Clarke, E., McCabe, K., & Lipsky, R. H. (2012). Oxytocin Receptor Genetic Variation Promotes Human Trust Behavior. Frontiers in human neuroscience, 6(4), 1-9.
• Kuhnen, C. M., & Knutson, B. (2011). The Influence of Affect on Beliefs, Preferences, and Financial Decisions. Journal of Financial and Quantitative Analysis, 46(3), 605-626.
• Lee, H.-J., Macbeth, A. H., Pagani, J. H., & Scott Young, W. (2009). Oxytocin: The Great Facilitator of Life. Progress in Neurobiology, 88(2), 127-151. https://doi.org/https://doi.org/10.1016/j.pneurobio.2009.04.001
• Lo Dico, G. (2013). Neuroeconomics, Identity Theory, and the Issue of Correlation. Theory & Psychology, 23(5), 576-590.
• Montague, P. R., & Berns, G. S. (2002). Neural Economics and the Biological Substrates of Valuation. Neuron, 36(2), 265-284.
• Montague, P. R., Dayan, P., & Sejnowski, T. J. (1996). A Framework for Mesencephalic Dopamine Systems Based on Predictive Hebbian Learning. Journal of neuroscience, 16(5), 1936-1947.
• Park, J. W., & Zak, P. J. (2007). Neuroeconomics Studies. Analyse & Kritik, 29(1), 47-59. https://doi.org/doi:10.1515/auk-2007-0104
• Reuter, M., & Montag, C. (2016). Neuroeconomics—an Introduction. Springer.
• Rustichini, A. (2009). Neuroeconomics: What Have We Found, and What Should We Search For. Current opinion in neurobiology, 19(6), 672-677.
• Schultz, W., Apicella, P., & Ljungberg, T. (1993). Responses of Monkey Dopamine Neurons to Reward and Conditioned Stimuli During Successive Steps of Learning a Delayed Response Task. Journal of neuroscience, 13(3), 900-913.
• Schultz, W., Dayan, P., & Montague, P. R. (1997). A Neural Substrate of Prediction and Reward. Science, 275(5306), 1593-1599.
• Stimolo, M. (2016). An Economic Agent in My Brain? A Critical Analysis of Multiple-Self Models in Neuroeconomics. Review of Social economy, 74(4), 329-348.
• Swierczynska-Kaczor, U. (2015). Neuroscience in Consumer Marketing Research. An Analysis Drawn from the Examples of Food Products. Acta Scientiarum Polonorum. Oeconomia, 14(2), 163–172.
• Tank, A. K., & Farrell, A. M. (2022). Is Neuroaccounting Taking a Place on the Stage? A Review of the Influence of Neuroscience on Accounting Research. European Accounting Review, 31(1), 173-207.
• Urbina, D. A., & Ruiz-Villaverde, A. (2019). A Critical Review of Homo Economicus from Five Approaches. The American Journal of Economics and Sociology, 78(1), 63-93. https://doi.org/https://doi.org/10.1111/ajes.12258
• Volk, S., & Köhler, T. (2012). Brains and Games: Applying Neuroeconomics to Organizational Research. Organizational Research Methods, 15(4), 522-552.
• Yayar, R., & Tekgün, B. (2020). Nöroekonomi Bağlamında Karar Alma Süreci. IKSAD JOURNAL, 6(22), 160-169.
• Zak, P. J. (2013). The Moral Molecule: The New Science of What Makes Us Good or Evil. Random House.