%0 Journal Article
%T Optimal taxation and monitoring in an economy with matching frictions and underground activities
%A Gaetano LISI
%J Eastern Journal of European Studies
%D 2011
%I Alexandru Ioan Cuza University of Iasi
%X This short paper shows the interdependence of taxation and monitoring policy in a search and matching model of equilibrium unemployment with an underground sector. More precisely, from a social welfare standpoint, two options are available to the policy maker: she/he may either substitute a tighter monitoring with a higher penalty or enforce both a higher taxation and an increased monitoring.
%K optimal taxation
%K tax evasion
%K underground economy
%K job search
%U http://www.ejes.uaic.ro/articles/EJES2011_0201_LIS.pdf