This article analyzes employer labor tax evasion and the impact on this evasion of tax inspections by a labor inspectorate. The analysis is based on a unique data set built by linking two sources of information: a data set of individual artisan firms and an individual audit data set. Our data...

The economic literature on audit design has almost entirely ignored tax agencies' practical reliance on whistle-blowers for the successful conduct of tax investigations. The authors compare the tax agency's performance under a one-round blind-audit policy and a two-round...

This article analyzes the relative choice between different tax tools burdening corporate incomes or dividends at the personal level in open economies where tax evasion, both corporate and personal, is not null. A theoretical discussion explains why a government may decide to levy a positive...

This article provides experimental evidence regarding the influence of positive rewards on income tax evasion behavior. In particular, the authors experimentally test the impact of positive rewards in the form of individual lottery winnings for fully compliant taxpayers. Among other things, the...

The authors characterize equilibria of an income reporting game with bounded returns and no commitment where detected tax evaders are charged the maximally feasible amount. Introducing partial commitment to punishment relief eliminates multiplicity of equilibria. The authors identify a unique...

Standard models of tax evasion use a static decision-under-uncertainty setting to determine how an individual’s evasion decision is affected by the fiscal instruments. Most of these models fail to create a framework, within which unique relationships between tax evasion and its main...

Italy adopted in 1998 a peculiar audit scheme (Studi di Settore), for small and medium enterprises and the self-employed. This scheme is based on a particular interaction between the tax agency and taxpayers, where the agency unveils only part of the information used to develop its audit rule....

Measuring the impact of tax policy on tax evasion is crucial in estimating government revenues. In the United States, the government estimates that $300–$400 billion is lost each year to tax evasion. This article combines dynamic scoring with household preferences for tax evasion à la Feige...

This article studies equilibrium effects of fiscal policy within a dynamic general equilibrium model where tax evasion and underground activities are explicitly incorporated. In particular, we show that a dynamic general equilibrium with tax evasion may give a rational justification for a...

After two decades of research on money laundering, it seems time to look at what we know and what progress has been made in research. One simple question is whether we know if money laundering has increased, stayed constant, or decreased over these years. This article shows that over the last...