Firm-oriented policies, tax cheating and perverse outcomes

This paper examines the implications of firm-oriented fiscal policies, namely investment subsidies and tax allowances, in an economy where producers may potentially avoid taxes. Among our results we stress the following. First, although investment subsidies induce increased capital accumulation (a level effect), they promote tax evasion; these subsidies induce firms to increase actual capital accumulation (a level effect), but also produce a reduction in the share of aggregate capital stock deployed in taxed, "official" production (a composition effect). Second, parameters characterizing the tax enforcement system play a major role in explaining tax evasion and firm size. Third, the technology structure matters for determining how to allocate resources between official and unofficial production.State aid, tax exemptions, investment subsidies, tax evasion, unofficial underground production, investment

State Aid Policies and Underground Activities

The main goal of this paper is to examine the implications of firm-oriented fiscal policies, such as capital subsidies and tax allowances, in an economy with an underground sector. In addition, we investigate whether the technology structure of “hidden” production may facilitate or counteract the effects of fiscal policies on firm behavior. Among our results we stress the following: first, capital subsidies promote tax evasion; these subsidies induce firms to increase actual capital accumulation (a level effect), but also produce a reduction in the regular share of aggregate capital stock (a composition effect). Second, tax relief reduces underground activities and fosters capital accumulation, as well as aggregate production. Third, the technology structure matters for determining how to allocate resources between formal and informal production, hence the amount of reported revenues.State aid, tax exemptions, capital subsidies, tax evasion, underground production, physical capital accumulation.

Capital Subsidies and Underground Production

In this paper we investigate the effects of different fiscal policies on the firm choice to produce underground. We consider a tax evading firm operating simultaneously both in the regular and in the underground economy. We suggest that such a kind of firm, referred to as moonlighting firm, is able to offset the specific costs usually stressed by literature on underground production, such as those suggested by Loayza (1994) and Anderberg et alii (2003). Investigating the effects of different fiscal policy interventions, we find that taxation is a critical parameter to define the size of capital allocation in the underground production. In fact, a strong and inverse relationship is found, and tax reduction is the best policy to reduce the convenience to produce underground. We also confirm the depressing effect on investment of taxation (see, for instance, Summers, 1981), so that tax reduction has no cost in terms of investment. By contrast, the model states that while enforcement is an effective tool to reduce capital allocation in the underground production, it also reduce the total capital stock. Moreover, we also suggest that the allowance of incentives to capital accumulation may generate, in this specific typology of firm, some unexpected effects, causing, together with a positive investment process, also an increase in the share of irregularity. This finding could explain, in a microeconomic framework, the evidence of Italian southern regions, where high incentives are combined with high irregularity ratios.tax evasion, moonlighting, capital subsidies, underground production

Prediction of turbulence control for arbitrary periodic spanwise wall movement

In order to generalize the well-known spanwise-oscillating-wall technique for drag reduction, non-sinusoidal oscillations of a solid wall are considered as a means to alter the skin-friction drag in a turbulent channel flow. A series of Direct Numerical Simulations is conducted to evaluate the control performance of nine different temporal waveforms, in addition to the usual sinusoid, systematically changing the wave amplitude and the period for each waveform. The turbulent average spanwise motion is found to coincide with the laminar Stokes solution that is constructed, for the generic waveform, through harmonic superposition. This allows us to define and compute, for each waveform, a new penetration depth of the Stokes layer which correlates with the amount of turbulent drag reduction, and eventually to predict both turbulent drag reduction and net energy saving rate for arbitrary waveforms. Among the waveforms considered, the maximum net energy saving rate is obtained by the sinusoidal wave at its optimal amplitude and period. However, the sinusoid is not the best waveform at every point in the parameter space. Our predictive tool offers simple guidelines to design waveforms that outperform the sinusoid for given (suboptimal) amplitude and period of oscillation. This is potentially interesting in view of applications, where physical limitations often preclude the actuator to reach its optimal operating conditions

SERENA Integrated Test (SIT#2) Report

SERENA is a package of four instruments connected to a unique System Control Unit. On-ground test with the 4 units connected (Serena Integrated configuration) have been performed with the Flight Spare Units. This document reports the overall activity and results with all the Co-Pi institutes and teams and coordinated by the PI team. This document is a report of the campaign prepared in 2016 and performed at Bern University from 30 Jan 2017 up to 10 Mar 2017

The attached reverse and detached forward cascades in wall-turbulent flows

The present work describes the multidimensional behaviour of wall-bounded turbulence in the space of cross-scales (spanwise and wall-normal) and distances from the wall. This approach allows us to understand the cascade mechanisms by which scale-energy is transmitted scale-by-scale away from the wall, through the overlap layer, and into the bulk flow. Two distinct cascades are identified involving the attached and detached scales of motion, respectively. From the near-wall region, scale-energy is transferred towards the bulk, flowing through the attached scales of motion, while among the detached scales it converges towards small scales, ascending again to the channel centre. It is then argued that the attached scales of wall-bounded turbulence are involved in a reverse cascade process that starts from the wall and ends in the bulk flow. On the other hand, the detached scales belong to a direct forward cascade process towards dissipation. Hence, at a given distance from the wall the attached motion is fed by smaller attached scales located closer to the wall. In turn this attached motion is responsible for creating the scale-energy that sustains larger attached scales farther from the wall and smaller detached scales that are responsible for connecting the scale-energy at large scales to the dissipation at small scales through a forward cascade. © Published under licence by IOP Publishing Ltd

Turbulent Rayleigh-Bénard convection with polymers: Understanding how heat flux is modified

We study how polymers affect the heat flux in turbulent Rayleigh-Bénard convection at moderate Rayleigh numbers using direct numerical simulations with polymers of different relaxation times. We find that heat flux is enhanced by polymers and the amount of heat enhancement first increases and then decreases with the Weissenberg number, which is the ratio of the polymer relaxation time to the typical time scale of the flow. We show that this nonmonotonic behavior of the heat flux enhancement is the combined effect of the decrease in the viscous energy dissipation rate due to the viscosity of the Newtonian fluid and the increase in the energy dissipation rate due to polymers when Weissenberg number is increased. We explain why the viscous energy dissipation rate decreases with the Weissenberg number. Then by carrying out a generalized boundary layer analysis supplemented by a space-dependent effective viscosity from the numerical simulations, we provide a theoretical understanding of the change of the heat flux when the viscous energy dissipation rate is held constant. Our analysis thus provides a physical way to understand the numerical results

Comparison of Theory and Direct Numerical Simulations of Drag Reduction by Rodlike Polymers in Turbulent Channel Flows

Numerical simulations of turbulent channel flows, with or without additives, are limited in the extent of the Reynolds number \Re and Deborah number \De. The comparison of such simulations to theories of drag reduction, which are usually derived for asymptotically high \Re and \De, calls for some care. In this paper we present a study of drag reduction by rodlike polymers in a turbulent channel flow using direct numerical simulation and illustrate how these numerical results should be related to the recently developed theory

Turbulent statistics and interface dynamics in a lubricated channel flow at R e τ = 100

In this work we aim to study, through the use of Direct Numerical Simulations (DNS), the turbulent drag reduction (DR) that occurs in a lubricated channel during the transport of a fluid at a low Reynolds number. In this situation, one of the two fluids separates the second from the wall forming a thin layer in contact with it. In our configuration the thin lubricating layer is adjacent to one of the wall, which will be called lubricated side and and we consider the same density (ρ1=ρ2) for the two fluids, while for the viscosity ratio (λ=ν1/ν2) we will consider two different values: λ=1 and λ=0.5. Moreover to assess the role of the surface tension we have duplicated the two simulations at We number of We=0.055 and We=0.5. As expected the DR mechanism is strongly related to the viscosity ratio, in particular the flow rate increase when decreasing λ due to a relaminarization of the lubricated layer. Moreover, the parametric analysis on the effect of viscosity ratio and surface tension allows us to highlight very interesting modulations of the dynamics of the interface and of the turbulent kinetic budgets. To date, the latest studies in this area have been carried out using the Phase Field Method for the description of the interface. One of the scopes of the present study is to confirm and extend the existing results by exploring the dynamics of the flow with the use of the volume of fluid method