Behavioral Explanation of Tax Asymmetries

Autor/innen

  • Martin Forchmann
  • Martin Jacob

DOI:

https://doi.org/10.24352/UB.OVGU-2018-464

Schlagworte:

Asymmetric Taxation, Loss Offset Rules, Loss Aversion, Behavioral Economics

Abstract

This note develops a behavioral explanation for the existence of an asymmetric tax treatment of gains and losses when investors are loss averse. We find that loss offset rules should be more restrictive for investors which are (1) more risk averse in case of gains, (2) less risk seeking in case of losses, or (3) more loss averse. Our findings have important policy implications. Tax authorities often implement identical loss offset rules for different investor clienteles. However, there should be specific loss offset rules for investors who differ in risk attitude as well as in loss aversion.

Veröffentlicht

2018-10-08

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