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Author: Philipp Meyer-Brauns Publisher: ISBN: Category : Languages : en Pages : 26
Book Description
This paper derives the optimal financial contract when an entrepreneur can evade taxes in a model of costly state verification. In contrast to previous literature on costly state verification and financial contracting, we find that standard debt contracts are not optimal when tax evasion is possible. Instead, the optimal contract is debt-like only for very low and very high profit realizations, and features a constant repayment and verification of returns in an intermediate range. This occurs because the entrepreneur has to be given a positive rent even under verification in order to not abuse her limited liability protection for excessive tax evasion activities.
Author: Philipp Meyer-Brauns Publisher: ISBN: Category : Languages : en Pages : 26
Book Description
This paper derives the optimal financial contract when an entrepreneur can evade taxes in a model of costly state verification. In contrast to previous literature on costly state verification and financial contracting, we find that standard debt contracts are not optimal when tax evasion is possible. Instead, the optimal contract is debt-like only for very low and very high profit realizations, and features a constant repayment and verification of returns in an intermediate range. This occurs because the entrepreneur has to be given a positive rent even under verification in order to not abuse her limited liability protection for excessive tax evasion activities.
Author: Martin W. Tackie Publisher: ISBN: Category : Languages : en Pages : 154
Book Description
This dissertation focuses on the problem of misreporting in the corporate setting, where managers may commit accounting fraud, and in the public sector, where taxpayers may not truthfully report their income. Both accounting fraud and income misreporting have contributed to unprecedented financial losses to shareholders and governments respectively. As a result, policy-makers and shareholders are focused on one goal, that is, to mitigate the occurrence of accounting fraud and income misreporting. The process of achieving this goal starts with understanding how compensation contracts and tax schemes influence an agent's willingness to misreport. This dissertation pursues these objectives using a blend of theory, experimental techniques, and exhaustive empirical analyses. Chapter 1 has a theoretical focus; this chapter evaluates the incentive effects of various contracts within the class of stock option contracts. In this chapter, we develop a principal-agent model of managerial fraud to determine whether there exists a contract that 'dominates' another contract by generating relatively greater effort while minimizing fraud. While there exists an infinity of stockoption contracts that induce a given level of effort, we show that within the class of stock option contracts, any two contracts that induce the same effort must necessarily induce the same level of fraud. We also characterize the schedule of implementable effort-fraud pairs. Chapters 2 and 3 have an experimental focus; in Chapter 2, we implement the theoretical model in Chapter 1 and test whether contracts that are predicted to induce the same level of effort and fraud are behaviorally equivalent. The experiment produced strong results in support of our hypothesis. The predicted equivalent class of stock option contracts induced the same level of effort and the same level of fraud. In a behavioral sense, stock option contracts are the same as simple equity contracts. Chapter 3 focuses on tax compliance behavior under the progressive and the regressive tax systems in an experimental setting. This chapter contributes to the growing literature on tax compliance by experimentally testing whether tax compliance behavior of taxpayers is sensitive to either the progressive or the regressive tax system. All else constant, experimental results showed no difference in average tax compliance between the progressive and the regressive tax systems. However, fairness, risk-aversion, inequality aversion, and gender played an important role in explaining variations in tax compliance behavior.
Author: W. Fred van Raaij Publisher: Springer ISBN: 1137544252 Category : Business & Economics Languages : en Pages : 286
Book Description
Government policies, marketing campaigns of banks, insurance companies, and other financial institutions, and consumers' protective actions all depend on assumptions about consumer financial behavior. Unfortunately, many consumers have no or little knowledge of budgeting, financial products, and financial planning. It is therefore important that organizations and market authorities know why consumers spend, borrow, insure, invest, and save for their retirement - or why they do not. Understanding Consumer Financial Behavior provides a systemic economic and behavioral approach to the way people handle their finances. It discusses the different types of financial behaviors consumers may engage in and explores the psychological explanations for their behavior and choices. This exciting new book is essential reading for scholars of marketing, finance, and management; financial professionals; and consumer policy makers.
Author: Ross K. McGill Publisher: Springer ISBN: 3319617834 Category : Business & Economics Languages : en Pages : 292
Book Description
This book is a practical guide to global anti-tax evasion frameworks. Coverage includes base erosion and profit shifting (BEPS), the Common Reporting Standard (CRS), and the Automatic Exchange of Information (AEoI). It covers the practical operational issues these frameworks present and offers insight into practical compliance options and operational methodologies to reduce costs and risks. The book concludes with insights into how institutions can translate these complex obligations into effective client communications.
Author: Jayesh D'Souza Publisher: CRC Press ISBN: 1439828512 Category : Law Languages : en Pages : 216
Book Description
Tracking funding is a critical part of the fight against terrorism and as the threat has escalated, so has the development of financial intelligence units (FIUs) designed to investigate suspicious transactions. Terrorist Financing, Money Laundering, and Tax Evasion: Examining the Performance of Financial Intelligence Units provides a thorough analy
Author: Robert W. McGee Publisher: Springer Science & Business Media ISBN: 1461412870 Category : Business & Economics Languages : en Pages : 678
Book Description
Why do people evade paying taxes? This is the central question addressed in this volume by Robert McGee and a multidisciplinary group of contributors from around the world. Applying insights from economics, public finance, political science, law, philosophy, theology and sociology, the authors consider the complex motivations for not paying taxes and the conditions under which this behavior might be rationalized. Applying theoretical approaches as well as empirical research, The Ethics of Tax Evasion considers three general arguments for tax evasion: (1) in cases where the government is corrupt or engaged in human rights abuses; (2) where citizens claim inability to pay, unfairness in the tax system, paying for things that do not benefit the taxpayer, excessively high tax rates, or where taxes are used to support an unpopular war; and (3) through philosophical, moral, or religious opposition. The authors further explore these issues by asking whether attitudes toward tax evasion differ by country or other demographic variables such as gender, age, ethnicity, income level, marital status, education or religion. The result is a multi-faceted analysis of tax evasion in cultural and institutional context, and, more generally, a study in ethical dilemmas and rational decision making.
Author: World Bank Publisher: World Bank Publications ISBN: 1464814414 Category : Business & Economics Languages : en Pages : 241
Book Description
Seventeen in a series of annual reports comparing business regulation in 190 economies, Doing Business 2020 measures aspects of regulation affecting 10 areas of everyday business activity.
Author: Philipp Meyer-Brauns
Author: Philipp Meyer-Brauns
Author: United States. General Accounting Office
Author: 
Author: Martin W. Tackie
Author: League of Nations
Author: W. Fred van Raaij
Author: Ross K. McGill
Author: Jayesh D'Souza
Author: Robert W. McGee
Author: World Bank