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The government-taxpayer game

Author

Listed:
  • Carfì, David
  • Fici, Caterina

Abstract

In this paper, we model - quantitatively – a possible realistic interaction between a tax-payer and his Government. We formalize, in a general setting, this strategic interaction. Moreover, we analyze "completely" a particular realistic sample of the general model. We determine the entire payoff space of the sample game; we find the unique Nash equilibrium of the interaction; we determine the payoff Pareto maximal boundary, conservative payoff zone and the conservative core of the game (part of Pareto boundary greater than the conservative payoff vector). Finally, we suggest possible compromise solutions between the two players. From an economic point of view, the sample chosen gives an example of normative settings, for which there is no reason (convenience), for the tax-payer, to evade the taxes or to declare less than his real income. Moreover, the two proposed compromise solutions (which realize the maximum collective gain) could be significantly applied to distinguished tax-payer (big companies and so on).

Suggested Citation

  • Carfì, David & Fici, Caterina, 2012. "The government-taxpayer game," MPRA Paper 38506, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:38506
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    File URL: https://mpra.ub.uni-muenchen.de/38506/1/MPRA_paper_38506.pdf
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    References listed on IDEAS

    as
    1. Carfì, David & Musolino, Francesco, 2011. "Game complete analysis for financial markets stabilization," MPRA Paper 34901, University Library of Munich, Germany.
    2. Carfì, David & Schilirò, Daniele, 2010. "Crisis in the Euro area: coopetitive game solutions as new policy tools," MPRA Paper 31891, University Library of Munich, Germany, revised 26 Jun 2011.
    3. Carfì, David & Perrone, Emanuele, 2012. "Game complete analysis of symmetric Cournot duopoly," MPRA Paper 35930, University Library of Munich, Germany.
    4. David Carf'i & Daniele Schilir'o, 2011. "A model of coopetitive game and the Greek crisis," Papers 1106.3543, arXiv.org, revised Sep 2011.
    5. Carfì, David & Musolino, Francesco, 2012. "A coopetitive approach to financial markets stabilization and risk management," MPRA Paper 37098, University Library of Munich, Germany.
    6. David Carfì & Emanuele Perrone, 2013. "Asymmetric Cournot Duopoly: A Game Complete Analysis," Journal of Reviews on Global Economics, Lifescience Global, vol. 2, pages 194-202.
    7. Carfì, David & Perrone, Emanuele, 2011. "Game complete analysis of Bertrand Duopoly," MPRA Paper 31302, University Library of Munich, Germany.
    8. Carfì, David, 2009. "Differentiable game complete analysis for tourism firm decisions," MPRA Paper 29193, University Library of Munich, Germany.
    9. Carfì, David & Schilirò, Daniele, 2011. "A framework of coopetitive games: applications to the Greek crisis," MPRA Paper 78089, University Library of Munich, Germany.
    10. Carfì, David & Gambarelli, Gianfranco & Uristani, Angelo, 2011. "Balancing pairs of interfering elements," MPRA Paper 35335, University Library of Munich, Germany.
    11. Carfì, D. & Magaudda, M. & Schilirò, D., 2010. "Coopetitive game solutions for the eurozone economy," MPRA Paper 26541, University Library of Munich, Germany.
    12. repec:srs:volume:v:3:y:2012:i:1(5):p:10-25 is not listed on IDEAS
    13. Carfì, David, 2011. "Financial Lie groups," MPRA Paper 31303, University Library of Munich, Germany.
    14. Carfì, David & Schilirò, Daniele, 2011. "Coopetitive games and global green economy," MPRA Paper 32035, University Library of Munich, Germany.
    15. Carfì, David & Schilirò, Daniele, 2012. "Global green economy and environmental sustainability: a coopetitive model," MPRA Paper 37018, University Library of Munich, Germany.
    16. Carfì, David & Patané, Giusy & Pellegrino, Samantha, 2011. "Coopetitive games and sustainability in project financing," MPRA Paper 32039, University Library of Munich, Germany.
    17. Carfì, David & Perrone, Emanuele, 2011. "Asymmetric Bertrand duopoly: game complete analysis by algebra system Maxima," MPRA Paper 35417, University Library of Munich, Germany.
    18. Carfì, David & Ricciardello, Angela, 2011. "Mixed extensions of decision-form games," MPRA Paper 28971, University Library of Munich, Germany.
    19. Carfì, David & Trunfio, Alessandra, 2011. "A non-linear coopetitive game for global green economy," MPRA Paper 32036, University Library of Munich, Germany.
    20. repec:srs:jarle2:2:v:3:y:2012:i:1:p:10-25 is not listed on IDEAS
    21. Carfì, David & Pintaudi, Angelica, 2012. "Optimal participation in illegitimate market activities: complete analysis of 2-dimensional cases," MPRA Paper 37822, University Library of Munich, Germany.
    22. Carfì, David & Ricciardello, Angela & Agreste, Santa, 2011. "An Algorithm for payoff space in C1 parametric games," MPRA Paper 32099, University Library of Munich, Germany.
    23. Carfì, David & Ricciardello, Angela, 2009. "Non-reactive strategies in decision-form games," MPRA Paper 29262, University Library of Munich, Germany.
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    More about this item

    Keywords

    Government; taxpayer; tax; fiscal policy; tax evasion;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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