Taxation and accountability in developing countries

Abstract

We often believe that citizens who pay taxes to the government should have a stronger desire to make sure that the government spends their money wisely. According to this idea of a ?fiscal contract,? citizens who pay taxes expect accountable and democratic governments that deliver public goods. In this evidence review, we seek to answer two questions. First, does such a fiscal contract exist between citizens and governments in developing countries? Second, assuming that such a fiscal contract exists or can be created, how can governments increase taxation and decrease tax evasion? To answer these questions, we review and discuss recent evidence from empirical studies published between 2010 and 2016.

Guillermo Toral

Assistant Professor of Political Science