In an environment with extensive corruption where much of the population evades paying their full taxes due, we tackle … likelihood when others are thought to be evading. Thus, our modelling incorporates elements from the theory of information …

bureaucrats. It is shown that the existence of tax evasion does not affect corruption activities at the firm level, while the … budgetary repercussions of tax evasion induce less corruption. Policy measures which alter the gains or losses from corruption …