Research

Harju, J., Kankaanranta, I. & Kotakorpi, K. (2026). Taxi Market Deregulation: Effects on Market Outcomes, Tax Evasion and Crime. CESifo Working Paper No. 12819.

Abstract: We study the effects of taxi market deregulation in Finland, which removed price controls and lowered barriers to entry. The reform led to a surge in firm entry and a modest increase in exit, indicating substantial changes in market structure. Average taxi prices increased slightly according to price indices, while monthly firm-level reported sales and VAT declined by over 10 percent. Operating costs and mileage remained largely unchanged, suggesting limited demand responses. These findings point to increased tax evasion following deregulation. Consistent with this interpretation, we document a small rise in property crime, with no effects on other criminal offenses.

The Threat Is Not Enough: Effects of a Tax Audit Campaign on Firms’ Tax Evasion (solo authored, draft available upon request)

Abstract: I study an audit campaign and risk-based audits targeted at restaurants in Finland. I examine how firms report VAT before and after the onset of the campaign, and around the point of an audit. In contrast to prior empirical research, no positive changes in reported sales, VAT, and net-VAT are observed either during the campaign or following an audit. This suggests that dynamic enforcement effects may be highly context-specific. The absence of positive changes in reported sales and VAT could be explained by an increase in financial constraints post-audit if a rise in tax liability incentivized firms to downscale their operations.

What Do Audits Reveal About Profit Shifting of Multinational Companies in South Africa? (with Jukka Pirttilä, Michelle Pleace and Nadine Riedel)

Descriptive Insights on Audit Data (with Ashley Gandy, Veikka Karvonen, Jukka Pirttilä, Michelle Pleace and Nadine Riedel)