Independent Auditors as Fiscal Gatekeepers
28 Pages Posted: 6 Feb 1997
Date Written: January 1996
This paper develops a framework for the analysis of gatekeeping in tax enforcement, whereby independent auditors are assigned the duty of certifying taxpayers' reports. The equilibrium of the market for gatekeepers' services is characterized, as well as taxpayers' and auditors' optimal behavior. The paper discusses the optimal structure of the gatekeeping regime and determines the conditions under which it is socially preferable to direct public enforcement.
JEL Classification: H29
Suggested Citation: Suggested Citation