Purpose: The purpose of this paper is to introduce the factor of emotional intelligence (EI) into the calculus of neoclassical analysis under precautionary saving aiming at stabilizing consumption in the case of an exogenous output shock. Design/methodology/approach: The introduction of EI...

Summary This paper investigates the relationship between the underground economy and tax evasion through a microeconomic model based on portfolio theory. The underground economy is assumed to be the result of bureaucracy, excessive regulation, and tax evasion. The main conclusion of the analysis...