KOLM, ANN-SOFIE; NIELSEN, SØREN BO - In: Journal of Public Economic Theory 10 (2008) 2, pp. 195-217
To examine the effects on labor market performance of government tax and enforcement policies, this paper develops an equilibrium model featuring tax evasion, matching frictions, and worker-firm wage bargains. In the wage bargains, workers and firms can agree on the amount of remuneration that...