Ravikumar, B.; Zhang, Yuzhe - Volkswirtschaftliche Fakultät, … - 2010
We study the optimal auditing of a taxpayer’s income in a dynamic principal-agent model of hidden income. Taxpayers in …-aversion utility function and a costly auditing technology, we show that the optimal auditing mechanism in our model consists of cycles …, then the auditing probability becomes positive. That is, the tax authority guarantees that the taxpayer will not be audited …