Data and Code for: "Hidden Baggage: Behavioral Responses to Changes in Airline Ticket Tax Disclosure"

Abstract:<br>We examine the impact of a January 2012 enforcement action by the U.S. Department of Transportation that required U.S. air carriers and online travel agents to modify their web interfaces to incorporate all ticket taxes in upfront, advertised fares. We show that the more prominent display of tax-inclusive prices is associated with significant reductions in consumer tax incidence, demand, and ticket revenues along more heavily-taxed itineraries. In particular, the fraction of unit taxes that airlines passed onto consumers fell by roughly 75 cents for every dollar of tax. These results reinforce prior findings on consumer inattention in a novel institutional setting featuring quasi-experimental variation in tax salience, economically-significant tax amounts, and endogenous price responses.<br><br>Scope of Materials Deposited:<br>The files deposited include code and instructions to permit replication of all results. The primary data sources used for the analysis are either restricted-use or proprietary in nature. Hence only ancillary public data sources are included. Instructions for obtaining these data are given in the file README.