The Ethics of Tax Adjudication: Initial Evidence on the Name-Letter Effect in Judicial Decision-Making

ABSTRACT The name-letter effect is the tendency for individuals to evaluate the alphabetical initials in their name particularly favorably due to egocentric bias. We investigate whether the name-letter effect influences judicial decision-making in a tax setting. We construct datasets from decades of tax court data for two types of taxpayers (individuals and corporations) in two jurisdictions (Canada and the United States). Our total sample size is 11,370 cases. Using all possible combinations of first letter matches between taxpayers’ and judges’ names, we do not find that the likelihood of a taxpayer achieving a favorable outcome is significantly higher than if there is no name-letter match. We also match first and last names of taxpayers with judges and do not find any significant differences in outcome likelihood. Our results suggest that a psycho-linguistic phenomenon with considerable empirical support in extralegal contexts is unlikely to unconsciously bias judges. Data Availability: Data are available through the Open Science Framework at https://osf.io/3v47u/?view_only=9edcb8afa6d74783bea626126ce98bb2