Current Research Projects (selected)

Spatial Tax Enforcement Spillovers: Evidence from South Africa

Revision invited at The Economic Journal


The purpose of this paper is to test for spatial enforcement spillovers. Empirical testing ground is the enforcement of business taxes in South Africa. The analysis relies on the population of business tax returns for the years 2009 to 2014 and data on all business taxpayer audits by the South African Revenue Services during that time period. The results suggest that audits significantly raise the tax reporting of non-audited neighboring firms. While the observed spillovers decline in geographic distance to the audited entity and are short-run in nature, the implied aggregate revenue gains are non-negligible. Additional analysis shows that the effect is driven by audit cases, where audited firms do not experience an upward revision in their tax owed in the course of the audit. This suggests that the observed effect roots in communication among taxpayers and is not driven by audit-related cost shocks to business partners.

Combatting Tax Evasion: Evidence from Comparing Commercial and Business Tax Registry

Revision invited at Journal of Development Economics


In 2008 and 2014, the South African Revenue Service (SARS) did snapshot synchronizations of its business tax registry with the country's commercial register in an attempt to identify firms that are non-compliant with their obligation to register with SARS for business tax purposes. We analyse these interventions drawing on SARS's business tax registry and the population of business tax returns between 2009 and 2014. Several findings emerge. First, in both years, the comparisons resulted in the identification of around 300,000 non-compliant taxpayers, providing prima facie evidence of significant extensive-margin tax evasion. The interventions significantly raised South African business tax revenues in the following years despite the fact that the identified `extensive-margin evaders' exhibit a lower propensity to submit tax returns and, conditional on return submission, report less income than comparable entities that voluntarily registered with SARS. The analysis further suggests that the observed gap in reported taxable income relates to underlying differences in firm size and corporate productivity rather than intensive-margin tax evasion. In line with `missing middle theories', extensive-margin evaders that submit tax returns are, moreover, found to exhibit increased sales and asset growth after their forced registration with SARS.

The Effects of Free Secondary School Track Choice: A Disaggregated Synthetic Control Approach


We exploit a recent state-level reform in Germany that granted parents the right to decide on the highest secondary school track suitable for their child, changing the purpose of the primary teacher's recommendation from mandatory to informational. Applying a disaggregated synthetic control approach to administrative district-level data, we find that transition rates to the higher school tracks increased substantially, with stronger responses among children from richer districts. Simultaneously, grade repetition in the first grades of secondary school increased dramatically, suggesting that parents choose school tracks also to align with their own aspirations - resulting in greater misallocation of students.

Prof Dr. Kristina Strohmaier

Any questions, ideas or fruitful comments? Please do not hestitate to contact me!

University of Duisburg-Essen, Universitätsstraße 12, 45117 Essen


Phone: +49 - (0) 201 18-33633