How long does the impact of corruption persist? Evidence from self-reported tax morale by multigenerational immigrants

Abstract This article examines the lasting impact of corruption on individual tax morale by analyzing variations in corruption levels across immigrants’ countries of origin. Using data on first- and second-generation immigrants, the study finds that first-generation immigrants from highly corrupt countries exhibit lower tax morale in their destination countries, whereas this effect disappears for the second generation. This suggests that the influence of corruption persists for up to a generation but does not fully transmit across generations. While local corruption and destination-country institutions broadly shape tax morale, home-country corruption continues to influence the fiscal behavior of first-generation immigrants. The findings indicate that cultural norms, rather than institutional trust, drive this persistence. Even when corruption is eradicated or individuals move to better-governed environments, trust in the fiscal contract does not immediately recover. The study highlights the need for cultural policy interventions to disrupt the cycle of corruption and improve tax compliance.