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Merit goods provision and optimal tax evasion

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Author Info
ROSELLA LEVAGGI () (DIPARTIMENTO DI SCIENZE ECONOMICHE -UNIVERSITA' DI BRESCIA)
FRANCESCO MENONCIN () (DIPARTIMENTO DI SCIENZE ECONOMICHE - UNIVERSITA' DI BRESCIA)

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Abstract

In a recent article Davidson, Lawrence and Wilson propose a model showing that, in the presence of distortionary taxation and goods of different quality, tax evasion can be an optimal device. Here, we show that this result, although quite interesting, cannot be generalised to a framework where Government activity consists of supplying merit goods and levying taxes to finance their provision.

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File URL: http://economicsbulletin.vanderbilt.edu/2008/volume8/EB-08H20003A.pdf
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Publisher Info
Article provided by Economics Bulletin in its journal Economics Bulletin.

Volume (Year): 8 (2008)
Issue (Month): 7 ()
Pages: 1-3
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:ebl:ecbull:v:8:y:2008:i:7:p:1-3

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Postal: Economics Bulletin, Department of Economics, 414 Calhoun Hall, Vanderbilt University, Nashville TN 37235, USA
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Related research
Keywords: Merit goods; tax evasion.;

Find related papers by JEL classification:
H2 - Public Economics - - Taxation, Subsidies, and Revenue
H4 - Public Economics - - Publicly Provided Goods

References listed on IDEAS
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  1. Rosella Levaggi, 2006. "Tax evasion and the cost of public sector activities," Working Papers ubs0616, University of Brescia, Department of Economics. [Downloadable!]
  2. Davidson, Carl & Martin, Lawrence & Wilson, John Douglas, 2007. "Efficient black markets?," Journal of Public Economics, Elsevier, vol. 91(7-8), pages 1575-1590, August. [Downloadable!] (restricted)
  3. Davidson, Carl & Martin, Lawrence W. & Wilson, John D., 2005. "Tax evasion as an optimal tax device," Economics Letters, Elsevier, vol. 86(2), pages 285-289, February. [Downloadable!] (restricted)
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This page was last updated on 2009-11-16.


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