This paper analyzes the behavior of the tax revenue to output ratio over the business cycle. In order to replicate the empirical evidence, we develop a simple model combining the standard Ak growth model with the tax evasion phenomenon. When individuals conceal part of their true income from the...

Affirmative-action policies bias tournament rules in order to provide equal opportunities to a group of competitors who have a disadvantage they cannot be held responsible for. Critics argue that they distort incentives, resulting in lower individual performance, and that the selected pool of...

Human capital accumulation may negatively affect economic growth by increasing tax avoidance and reducing effective tax rates and productive public investment. This paper analyzes how the endogenous feedback between human capital accumulation and tax avoidance affects economic growth and...

This paper estimates the effect of piracy attacks on shipping costs using a unique data set on shipping contracts in the dry bulk market. We look at shipping routes whose shortest path exposes them to piracy attacks and find that the increase in attacks in 2008 lead to around a ten percent...

We develop a model in which delinquents compete with each other in criminal activities but may benefit from being friends with other criminals by learning and acquiring proper know-how on the crime business. By taking the social network connecting agents as given, we study the subgame perfect...

International business transactions pose the problem of deterring bribing of public officials by foreign firms. We first analyze a convention styled after the OECD's "Convention on Combating Bribery of Foreign Public Officials in International Business Transactions" that requires signatory...

In a market where firms with different characteristics decide upon both the level of emissions and their reports, we study the optimal audit policy for an enforcement agency whose objective is to minimize the level of emissions. We show that it is optimal to devote the resources primarily to the...

This paper analyses the interplay between social structure and information exchange in two competing activities, crime and labor. We consider a dynamic model in which individuals belong to mutually exclusive two-person groups, referred to as dyads. Two individuals belonging to the same dyad hold...

Compliance is an important issue in environmental regulation. In this paper, we discuss some of the key elements of the problem and analyze a situation where emissions are not random and firms are risk-neutral. We study the firm's decision on emissions and compliance when the environmental...