Thilo Albers, Morten Jerven, Marvin Suesse, 22 November 2020

Why do large differences in tax revenues between states exist and persist? This column introduces a comprehensive new dataset of tax and revenue collection for all African polities from 1900 to 2015 to answer this central question. The results confirm the importance of democratic institutions and political stability, while de-emphasising the role of resource revenues. Overall, states in Africa have been able to build institutions for the collection of ‘hard’ taxes when the preconditions were favourable, especially when access to external finance was limited. These insights add important nuance to established theories of state-building in developing countries.

Richard Akresh, Daniel Halim, Marieke Kleemans, 18 May 2019

Does investment in schools promote higher educational attainment—and do the effects improve students’ later lives and those of the next generation? This column examines the impact of over 61,000 primary schools built by the Indonesian government between 1973 and 1979, almost doubling the number in the country. The evidence shows that the men and women who accessed education provided by the construction programme benefited from significant improvements in their educational and later life outcomes. So too did their children.

David Laborde, William Martin, 18 April 2019

Haichao Fan, Yu Liu, Nancy Qian, Jaya Wen, 29 July 2018

Enforcement of VAT requires accurate records of firm transactions that can be traced to both parties. This column describes how the Chinese government’s digitisation of the country’s VAT process increased enforcement, which in turn increased overall tax revenues in the short run. However, the increased enforcement caused firms to contract in the medium run, reducing the long-run gains in tax revenues.

Dominika Langenmayr, 13 November 2015

Voluntary disclosure programmes offer tax evaders the opportunity to come clean with reduced penalties. This column uses data from the US and Germany to examine the merits of such programmes. They are found to increase tax evasion, but also to significantly lower administrative costs, leading to a net increase in tax revenues.

CEPR Policy Research