nep-pub New Economics Papers
on Public Finance
Issue of 2007‒12‒15
two papers chosen by
Kwang Soo Cheong
Johns Hopkins University

  1. Public Universities, Tuition and Competition: A Tiebout Model By Schwager, Robert
  2. Tax Evasion in Kenya and Tanzania:Evidence from Missing Imports By Levin, Jörgen; Widell, Lars

  1. By: Schwager, Robert
    Abstract: A simple Tiebout model is presented where states provide university education to both immobile and mobile students. State governments choose the quality of public universities by trading off the value of education for the local immobile student population and the costs, net of tuition revenues, of running the university. The quality of education and the assignment of students to universities in an efficient allocation are characterised. It is shown that decentralised decisions result in efficient choices if states are allowed to choose tuition levels freely. If tuition is capped, ine±ciently low qualities are likely to arise.
    Keywords: higher education, migration, fiscal externality, club good, tuition
    JEL: H75 H77 I28
    Date: 2007
  2. By: Levin, Jörgen (Department of Business, Economics, Statistics and Informatics); Widell, Lars (Department of Business, Economics, Statistics and Informatics)
    Abstract: In this paper we estimate the amount of tax evasion in customs authorities in both Kenya and Tanzania by calculating measurement errors in reported trade flows between the two countries and correlate those errors with tax rates. We find that the measurement error is correlated with the tax rates in both Kenya and Tanzania. According to the Transparency International Corruption Perceptions Index, Kenya is more corrupt than Tanzania, but we find that the coefficient on tax is higher in Tanzania compared to Kenya implying that tax evasion on imported goods is higher in Tanzania compared to the Kenya. We also introduced a third country into our analysis, the United Kingdom, and tax evasion seems to be more severe in trade flows between Kenya and Tanzania compared to trade flows between the United Kingdom and Kenya/Tanzania. Finally we also find that the tax evasion coefficient is lower in the Kenya-United Kingdom case compared to the Tanzanian-United Kingdom case which supports our previous finding that tax evasion is more severe in the Tanzanian customs authority.
    Keywords: Tax evasion; corruption; trade; Kenya; Tanzania
    JEL: F14 H26
    Date: 2007–11–01

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