To evade or to pay: A perfect bayesian equilibrium in a government-importer game

• Main Authors: De La Rosa, Mary Patricia G., Respicio, Jerrie Mae Hyvi P., Samson, Craig Brendon G.
• Format: text
• Language: English
• Published: Animo Repository 2013
• Subjects: Bayesian statistical decision theory; Econometrics; Liability insurance; Indemnity against liability; Economics
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/10695
• Institution: De La Salle University

This paper studies the phenomenon of tariff evasion using a simple signaling model. Perfect Bayesian equilibrium is used to determine importer's optimal actions (to evade or to pay his tariff liability) after observing the signal of the government (high tariff rates or low tariff rates), given...