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f_kappa.m
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f_kappa.m
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function [ cost ] = f_kappa(h,param_cost)
%This function computes the cost of hiding income
% global alpha delta x_bar x_lowbar x_highbar
global time cost_specif
% global lambda_vec h_evasion t n cost_specif
%alpha = param_cost.alpha;
beta = param_cost.beta;
theta = param_cost.theta;
switch cost_specif
case 'c1' % alpha+beta*h^theta + delta(h/y-h_past/y_past)^2
if time>2000
y = tfp_vec(t)*lambda_vec(n);
y_past = tfp_vec(t-1)*lambda_vec(n);
h_past = h_evasion(n,t-1);
cost = alpha + beta * (h).^theta + delta*((h/y)-(h_past/y_past)).^2;
%cost = delta*((h/y)-(h_past/y_past)).^2; % only adj costs, as
%a check
else
cost = alpha + beta * (h).^theta;
end
case 'c2'
if time>2000
y = tfp_vec(t)*lambda_vec(n);
y_past = tfp_vec(t-1)*lambda_vec(n);
h_past = h_evasion(n,t-1);
cost = alpha + beta * (h).^theta + delta*((h/y)-(h_past/y_past)).^2;
%cost = delta*((h/y)-(h_past/y_past)).^2; % only adj costs, as
%a check
else
cost = alpha + beta * (h).^theta;
end
case 'c3' % cost depends on h/y ==> high prod evade more
y = tfp_vec(t)*lambda_vec(n);
if time>2000
y_past = tfp_vec(t-1)*lambda_vec(n);
h_past = h_evasion(n,t-1);
cost = alpha + beta *(h/y).^theta + delta*((h/y)-(h_past/y_past)).^2;
else
cost = alpha + beta * y*(h).^theta;
end
case 'c4' % beta * (alpha*h)^theta/(tfp_vec(t)^theta)
y = tfp_vec(t)*lambda_vec(n);
if time>2000
y_past = tfp_vec(t-1)*lambda_vec(n);
h_past = h_evasion(n,t-1);
cost = beta * (alpha*h)^theta/(tfp_vec(t)^theta)+ delta*((h/y)-(h_past/y_past)).^2;
else
cost = beta * (alpha*h)^theta/(tfp_vec(t)^theta);
end
case 'c5' % LOGISTIC alpha/1+exp[-theta(h-beta)]
if time>2000
%y_past = tfp_vec(t-1)*lambda_vec(n);
h_past = h_evasion(n,t-1);
cost = alpha ./ (1+exp(-theta*(h-beta))) + delta*((h)-(h_past)).^2;
else
cost = alpha ./ (1+exp(-theta*(h-beta)));
end
case 'c6' % double threshold
y = tfp_vec(t)*lambda_vec(n);
if h/y > x_highbar
cost = alpha+beta*y^theta*(x_highbar-x_lowbar)^theta;
elseif h/y < x_lowbar
cost = 0;
else
cost = alpha + beta *(h-x_lowbar*y).^theta;
end
case 'c7' % exponential
%cost = alpha+beta*exp(theta*(h-x_bar));
cost = beta*exp(theta*h);
end
end