Taxpayers do not always follow the crowd: The effects of regulatory focus and social norm on tax compliance

The communication of social norms is a strong driver of behavior and is therefore recommended as a persuasive tool for tax compliance. However, the evidence on the influence of social norms on tax behavior remains inconclusive. Ambiguous results could be explained by Regulatory Focus Theory, which posits that the situational motivational focus (i.e., prevention vs. promotion focus) may influence the relevance of social norms. To examine this moderating effect, we conducted a laboratory experiment. Participants were instructed to think about their responsibilities versus their desires; thus, we manipulated a prevention focus versus a promotion focus. They then received information about the tax-paying behavior of others, representing different social norms (low vs. high). The results suggest that a prevention focus enhances the effect of social norms on the motivation to pay honestly and on incentivized tax payments. The present paper demonstrates that the influence of social norms may depend on the regulatory focus and offers practical implications for increasing taxpayers' voluntary motivation to pay their fair share of taxes.