We focus on a relatively neglected area of the tax-compliance literature in economics, the behaviour of firms. We examine the impact of alternative audit rules on receipts from a tax on profits in the context of strategic interdependence of firms. In the market firms may compete in terms of...

Firms are usually better informed than tax authorities about market conditions and the potential profits of competitors. They may try to exploit this situation by under-reporting their own taxable profits. The tax authority could offset firms' informational advantage by adopting "smarter" audit...

We develop a model of commodity tax competition with monopolistically competitive internationally mobile firms, transport costs, and asymmetric country sizes. We investigate the impacts of non-cooperative tax setting, as well as of tax harmonization and changes in the tax principle, in both the...

A benevolent social planner which faces a cost of public funds because of distortive taxation, wants to finance an upstream monopoly. This monopoly produces a necessary input for a downstream competitive sector which competes à la Cournot (with either a fixed number of firms or free entry in...

The use of proxy variables to control for unobservables when estimating a production function has become increasingly popular in empirical works in recent years. The present paper aims to contribute to this literature in three important ways. First, we provide a structured review of the...

This paper presents a philosophical discussion of the ethical foundations of economic competition, based in large part on Emmanuel Levinas's theory of exteriority and of responsibility for the "Other". The claim is that competition, notwithstanding its positive effects in terms of efficiency and...

This paper investigates the relationship between firms’ innovation practices and performance in Taiwan. Using a panel of 4000 firms, we examine the effects of importing technology (versus doing R&D) on Total Factor Porductivity (TFP) growth. The relationship between these two innovation...

The objective of this paper is to identify the determinants of the decision to innovate in Taiwan. Three “innovation strategies” are considered : doing R&D only, importing technology only, and combining both. We estimate a Bivariate Probit on a panel of more than 27000 Taiwanese...

This paper investigates multi-item moral hazard with auditing contests. Although the presented model is widely applicable, we choose tax evasion as an exemplary application. We introduce a tax-evasion model where tax authority and taxpayer invest in detection and concealment. The taxpayers have...

We develop a moral hazard model with auditing where both the principal and the agent can influence the probability that the true state of nature is verified. This setting is widely applicable for situations where fraudulent reporting with costly state verification takes place. However, we use...