TY  - JOUR
AU  - Slemrod,Joel
AU  - Yitzhaki,Shlomo
TI  - The Optimal Size of a Tax Collection Agency
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 1759
PY  - 1985
Y2  - November 1985
UR  - http://www.nber.org/papers/w1759
L1  - http://www.nber.org/papers/w1759.pdf
N1  - Author contact info:
Joel Slemrod
University of Michigan Business School
701 Tappan Street
Room R5396
Ann Arbor, MI  48109-1234
Tel: 734/936-3914
Fax: 734-615-4323
E-Mail: jslemrod@umich.edu

Shlomo Yitzhaki
Department of Economics
Hebrew University
Mount Scopus
Jerusalem 91905
ISRAEL
Tel: 972-2-659-2201
Fax: 972-2-652-2319
E-Mail: shlomo.yitzhaki@huji.ac.il
AB  - This paper addresses the optimal degree of law enforcement regarding tax evasion. It derives the conditions that characterize the optimal size of a tax collection agency, and then provides a simple interpretation of the conditions in terms of excess burden.The paper clarified earlier findings that suggest that the optimal size should be set higher than a simple cost-benefit calculation would indicate. It concludes with a numerical example that illustrates the optimality condition and demonstrates that a policy based on a naive cost-benefit analysis of the tax collection agency could result in a substantial overcommitment of resources.
ER  -