POVERTY, TAX EVASION AND THE OPTIMUM GENERAL INCOME TAX

This paper combines poverty considerations in the social welfare function and tax evasion into an optimal general income tax problem. It investigates the optimal audit and tax structures using a model with two types of individual, endogenous labor supply and a hybrid social welfare function that captures the pluralism of the objectives of a full committed government. The results confirm the previous literature on tax evasion: (i) skilled households should never be audited and face any distortions in the labor supply, (ii) unskilled households have to be audited randomly (probability less than one) and (iii) Individuals should be rewarded if telling the truth about their income. In addition, the introduction of poverty concern as a negative externality brings new characteristics for the optimum income tax on poor: (iv) they may (or not) face negative marginal income tax. Also, a numerical example is provided to further explore the model.

THE DETERMINANTS OF CRIMINAL VICTIMIZATION IN SÃO PAULO STATE

In this paper an exploratory research of the determinants of criminal victimization in São Paulo state is conducted using the life-style and opportunity models with Seade's 1998 Pesquisa de Condição de Vida (Life Condition Survey). São Paulo is the most populous Brazilian state with 37 million inhabitants, responding for more than one third of the Brazilian GDP. Our results indicate that the life-style and opportunity models had a good fitting to the data. As expected, the likelihood of being a burglary/larceny victim is increasing in income and if the person is male, and it decreases if the person is married and has few years of schooling. In relation to assault, the victimization likelihood increases considerably if the person is asian, single or divorced, and foreigner, on the other hand, it is decreasing in income and years of schooling, and it is smaller for black or multi-racial background people.