BESFAMILLE, MARTIN; SIRITTO, CECILIA PARLATORE - In: Journal of Public Economic Theory 11 (2009) 6, pp. 897-926
Since <link rid="b31">Sandmo (1981)</link>, many articles have analyzed optimal fiscal policies in economies with tax evasion. All share a feature: they assume that the cost of enforcing the tax law is exogenous. However, governments often invest resources to reduce these enforcement costs. In a very simple model, we...