What question did this study set out to answer?

To examine whether the salience of a tax mechanism affects equilibrium tax rates by analyzing changes in toll rates following the adoption of electronic toll collection.

July 29, 2009The Quarterly Journal of Economics

E-ZTAX: Tax Salience and Tax Rates*

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Authors

AFAmy FinkelsteinMoscow Institute of Thermal Technology

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Implication

Empirical analysis reveals electronic toll collection increases steady-state toll rates by 20 to 40 percent, suggesting reduced tax salience diminishes driver price elasticity.

Key Points

To examine whether the salience of a tax mechanism affects equilibrium tax rates by analyzing changes in toll rates following the adoption of electronic toll collection.
Evaluated toll facility rate adjustments before and after the introduction of electronic toll collection (ETC).
Estimated driver price elasticity with respect to tolls and assessed the responsiveness of toll setting to the electoral calendar under ETC regimes.
Steady-state tolls increased by 20 to 40 percent compared to counterfactual levels without electronic toll collection.
Driving behavior became significantly less elastic with respect to toll rates under electronic tolling.
Toll setting became less sensitive to the timing of the electoral calendar following the adoption of electronic collection systems.

Cite This Study

Amy Finkelstein (2009) studied this question.

synapsesocial.com/papers/6a1b3daa20d1ce63c9c41b0a https://doi.org/10.1162/qjec.2009.124.3.969

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Implication

Empirical analysis reveals electronic toll collection increases steady-state toll rates by 20 to 40 percent, suggesting reduced tax salience diminishes driver price elasticity.

E-ZTAX: Tax Salience and Tax Rates*

Discussion

Member takes

Implication

Key Points

Cite This Study

E-ZTAX: Tax Salience and Tax Rates*

Discussion

Member takes

Implication

Key Points

Cite This Study

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