![]() Litina, Anastasia ![]() E-print/Working paper (2014) We provide empirical support and a theoretical explanation for the vicious circle of political corruption and tax evasion in which countries often fall into. We address this issue in the context of a ... [more ▼] We provide empirical support and a theoretical explanation for the vicious circle of political corruption and tax evasion in which countries often fall into. We address this issue in the context of a model with two distinct groups of agents: citizens and politicians. Citizens decide the fraction of their income for which they evade taxes. Politicians decide the fraction of the public budget that they peculate. We show that multiple self-fulfilling equilibria with different levels of corruption can emerge based on the existence of strategic complementarities, indicating that corruption may corrupt. Furthermore, we find that standard deterrence policies cannot eliminate multiplicity. Instead, policies that impose a strong moral cost on tax evaders and corrupt politicians can lead to a unique equilibrium. [less ▲] Detailed reference viewed: 142 (5 UL)![]() Litina, Anastasia ![]() E-print/Working paper (2011) We provide empirical support and a theoretical explanation for the vicious circle of political corruption and tax evasion in which countries often fall into. We address this issue in the context of a ... [more ▼] We provide empirical support and a theoretical explanation for the vicious circle of political corruption and tax evasion in which countries often fall into. We address this issue in the context of a model with two distinct groups of agents: citizens and politicians. Citizens decide the fraction of their income for which they evade taxes. Politicians decide the fraction of the public budget that they peculate. We show that multiple self-fulfilling equilibria with different levels of corruption can emerge based on the existence of strategic complementarities, indicating that corruption may corrupt. Furthermore, we find that standard deterrence policies cannot eliminate multiplicity. Instead, policies that impose a strong moral cost on tax evaders and corrupt politicians can lead to a unique equilibrium. [less ▲] Detailed reference viewed: 118 (4 UL)![]() Litina, Anastasia ![]() E-print/Working paper (2011) This paper characterizes analytically the saving rate in the Ramsey-Cass-Koopmans model with a general production function when there exists both exogenous and endogenous growth. It points out conditions ... [more ▼] This paper characterizes analytically the saving rate in the Ramsey-Cass-Koopmans model with a general production function when there exists both exogenous and endogenous growth. It points out conditions involving the share of capital and the elasticities of factor and intertemporal substitution under which the saving rate path to its steady-state value exhibits overshooting, undershooting, or is monotonic. Simulations illustrate these interesting dynamics. The paper also identifies the general class of production functions that render the saving rate constant along the entire transition path and hence make the Ramsey-Cass-Koopmans model isomorphic to that of Solow-Swan. [less ▲] Detailed reference viewed: 87 (4 UL)![]() Litina, Anastasia ![]() in Economics Letters (2008), 99 We correct an intermediate mistake in Barelli and Pessôa [Barelli P. and Pessôa S. de A., 2003, “Inada conditions imply that production function must be asymptotically Cobb–Douglas,” Economics Letters 81 ... [more ▼] We correct an intermediate mistake in Barelli and Pessôa [Barelli P. and Pessôa S. de A., 2003, “Inada conditions imply that production function must be asymptotically Cobb–Douglas,” Economics Letters 81, 361–363] and show that the main result is still valid. We also show that Barelli and Pessôa wrongly identified the class of functions with elasticity of substitution asymptotically equal to one as the Cobb–Douglas class. [less ▲] Detailed reference viewed: 149 (4 UL) |
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