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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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    References listed on IDEAS

    as
    1. Carfì, David, 2008. "Optimal boundaries for decisions," MPRA Paper 29243, University Library of Munich, Germany.
    2. repec:srs:journl:volume:v:3:y:2012:i:1(5):p:10-25 is not listed on IDEAS
    3. Carfì, David & Schilirò, Daniele, 2012. "Global green economy and environmental sustainability: a coopetitive model," MPRA Paper 37018, University Library of Munich, Germany.
    4. Carfì, David & Perrone, Emanuele, 2011. "Asymmetric Bertrand duopoly: game complete analysis by algebra system Maxima," MPRA Paper 35417, University Library of Munich, Germany.
    5. 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.
    6. Carfì, David & Trunfio, Alessandra, 2011. "A non-linear coopetitive game for global green economy," MPRA Paper 32036, University Library of Munich, Germany.
    7. Carfì, David & Bagileri, Daniela & Dagnino, Gianbattista, 2012. "Asymmetric R&D alliances and coopetitive games," MPRA Paper 37095, University Library of Munich, Germany.
    8. Carfì, David & Musolino, Francesco, 2012. "A coopetitive approach to financial markets stabilization and risk management," MPRA Paper 37098, University Library of Munich, Germany.
    9. Carfì, David, 2009. "Differentiable game complete analysis for tourism firm decisions," MPRA Paper 29193, University Library of Munich, Germany.
    10. David CARFÌ & Daniele SCHILIRÒ, 2011. "Crisis In The Euro Area: Coopetitive Game Solutions As New Policy Tools," Theoretical and Practical Research in the Economic Fields, ASERS Publishing, vol. 2(1), pages 22-36.
    11. repec:srs:volume:v:3:y:2012:i:1(5):p:10-25 is not listed on IDEAS
    12. Carfì, David & Schilirò, Daniele, 2011. "Coopetitive games and global green economy," MPRA Paper 32035, University Library of Munich, Germany.
    13. Carfì, David & Ricciardello, Angela, 2011. "Mixed extensions of decision-form games," MPRA Paper 28971, University Library of Munich, Germany.
    14. Carfì, David & Schilirò, Daniele, 2011. "A model of coopetitive games and the Greek crisis," MPRA Paper 32098, University Library of Munich, Germany.
    15. Carfì, David, 2010. "A model for coopetitive games," MPRA Paper 59633, University Library of Munich, Germany.
    16. Carfì, David & Ricciardello, Angela, 2009. "Non-reactive strategies in decision-form games," MPRA Paper 29262, University Library of Munich, Germany.
    17. Carfì, David & Patané, Giusy & Pellegrino, Samantha, 2011. "Coopetitive games and sustainability in project financing," MPRA Paper 32039, University Library of Munich, Germany.
    18. repec:srs:journl:jasf:v:2:y:2011:i:2:p:74-100 is not listed on IDEAS
    19. Carfì, David & Ricciardello, Angela & Agreste, Santa, 2011. "An Algorithm for payoff space in C1 parametric games," MPRA Paper 32099, University Library of Munich, Germany.
    20. Carfì, David & Schilirò, Daniele, 2011. "A framework of coopetitive games: applications to the Greek crisis," MPRA Paper 78089, University Library of Munich, Germany.
    21. Carfì, David & Gambarelli, Gianfranco & Uristani, Angelo, 2011. "Balancing pairs of interfering elements," MPRA Paper 35335, University Library of Munich, Germany.
    22. Carfì, D. & Magaudda, M. & Schilirò, D., 2010. "Coopetitive game solutions for the eurozone economy," MPRA Paper 26541, University Library of Munich, Germany.
    23. Carfì, David, 2011. "Financial Lie groups," MPRA Paper 31303, University Library of Munich, Germany.
    24. repec:srs:jarle2:2:v:3:y:2012:i:1:p:10-25 is not listed on IDEAS
    25. Carfì, David & Musolino, Francesco, 2011. "Game complete analysis for financial markets stabilization," MPRA Paper 34901, University Library of Munich, Germany.
    26. David Carfì & Francesco Musolino, 2011. "Fair Redistribution In Financial Markets A Game Theory Complete Analysis," Journal of Advanced Studies in Finance, ASERS Publishing, vol. 2(2), pages 74-100.
    27. David CARFÌ & Angelica PINTAUDI, 2012. "Optimal Participation In Illegitimate Market Activities Complete Analysis Of 2 Dimensional Cases," Journal of Advanced Research in Law and Economics, ASERS Publishing, vol. 3(1(5)), pages 10-25.
    28. Carfì, David & Perrone, Emanuele, 2012. "Game complete analysis of symmetric Cournot duopoly," MPRA Paper 35930, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Government; taxpayer; tax; fiscal policy; tax evasion;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • 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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