Macho-Stadler, Ines; Olivella, Pau; Perez-Castrillo, David - In: Journal of Public Economic Theory 1 (1999) 4, pp. 439-63
We present a dynamic model of tax evasion, where tax liabilities last for two periods and the probability of an inspection decreases with the sum of taxes evaded this period plus taxes evaded last period. We show that a tax amnesty that pardons more than the evasion penalties (an extensive...