SBEE Seminar Series: Charlie Sprenger
201 Lorch Hall, 611 Tappan St., Ann Arbor
The Social, Behavioral and Experimental Economics lecture series is sponsored by the School of Information, the Ross School of Business and the Department of Economics. Speakers from U.S. and international universities present their research at weekly seminars in winter 2017.
Procrastination in the Field: Evidence from Tax Filing
This paper attempts to identify present-biased procrastination in tax filing behavior. Our exercise uses dynamic discrete choice techniques to develop a counterfactual benchmark for filing behavior under the assumption of exponential discounting. Deviations between this counterfactual benchmark and actual behavior provide potential `missing-mass' evidence of present bias. In a sample of around 22,000 low-income tax filers we demonstrate substantial deviations between exponentially-predicted and realized behavior, particularly as the tax deadline approaches. Present-biased preferences not only provide qualitatively better in-sample fit than exponential discounting, but also have improved out-of-sample predictive power for responsiveness of filing times to the 2008 Economic Stimulus Act recovery payments. Additional experimental data from around 1100 individuals demonstrates a link between experimentally measured present bias and deviations from exponential discounting in tax filing behavior.
Charlie Sprenger is an associate professor of economics and strategic management in the department of economics at the University of California San Diego. Sprenger's interests focus on the fields of behavioral economics and experimental economics. His research includes local and global investigation into subjects such as intertemporal choice behavior, economic risk preferences and the relationship of time preferences to certain economic behaviors. Prior to coming to the Rady School of Management, Sprenger was an assistant professor of economics at Stanford University. He received his PhD in economics from the University of California, San Diego, and his M.Sc. in economics from University College London.