Controlling tax evasion fluctuations

Westerhoff, Frank; Lima, Welington; Zaklan, Georg

Controlling tax evasion fluctuations

Authors

Westerhoff, Frank

Lima, Welington

Zaklan, Georg

Description

We incorporate the behaviour of tax evasion into the standard two-dimensional Ising model and augment it by providing policy-makers with the opportunity to curb tax evasion via an appropriate enforcement mechanism. We discuss different network structures in which tax evasion may vary greatly over time if no measures of control are taken. Furthermore, we show that even minimal enforcement levels may help to alleviate this problem substantially.
12 pages including figures