A broad array of law enforcement strategies, from income tax to bank regulation, involve self-reporting by regulated agents and auditing of some fraction of the reports by the regulating bureau. Standard models of self-reporting strategies assume that although bureaus only have estimates of the...

We reexamine estimates of the social cost of carbon (SCC) used by agencies as the price of carbon emissions in cost-benefit analysis, focusing on those by the federal Interagency Working Group on SCC (IWG). We show that the models used by the IWG assume continued economic growth in the face of...

The precautionary principle requires that we take additional actions to prevent harm when the harm from an activity is uncertain and possibly irreversible. This paper considers whether environmental or other Pigouvian taxes should be precautionary. Should environmental taxes be set higher than...

Criticizes the need to treat short sales against the box as realization events. Argues that the net welfare gain of such treatment is uncertain (under traditional Haig-Simons notions of equity) and that efficiency gains are dependent on views of stock trading.

This paper extends the literature on the effect of an income tax on risk taking to the case where different tax rates apply to different types of assets. It shows that an income tax that nominally imposes different rates on the full return to investments can be recharacterized as a uniform tax...

A broad array of law enforcement strategies, from income tax to bank regulation, involve self-reporting by regulated agents and auditing of some fraction of the reports by the regulating bureau. Standard models of self-reporting strategies assume that although bureaus only have estimates of the...

A regulator, seeking to maximize net benefits, must choose between rules and standards and then set a level of care. The regulated agents have private information about their compliance costs. Rules are set ex ante, so agents know the required level of care. Standards are established after...

The audit policy of a tax authority can signal its audit effectiveness. We model this process and show that in limited circumstances an ineffective authority can masquerade as being effective. We show that high maximal penalties imply underreporting of income.

This paper analyzes the consequences of happiness research for taxation. It focuses on the finding that happiness depends on status as well as income, examining how adding status concerns to standard optimal tax models changes the results. It then compares the empirical findings of the happiness...

This article analyzes the effect of tax law doctrines designed to reduce tax shelters, such as the business-purpose doctrine, and the economic-substance doctrine. The article analyzes these doctrines as changes to the marginal elasticity of taxable income. As these doctrines are strengthened,...