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on Informal and Underground Economics |
| By: | James Alm (Tulane University) |
| Abstract: | How can administrative policies be devised to improve tax compliance? To answer this broad question, I examine three specific questions. First, why do people pay their taxes? Second, that are the impacts of recent technological innovations on tax administration and tax compliance? Third, what are the implications of this research for tax administrations? In the spirit of much of Richard Bird’s work, I examine academic research on these questions that is relevant for both developed and developing countries, focusing on those aspects of research that may be of some use in administrative efforts to improve tax compliance. I conclude with some predictions about future research trends. |
| Keywords: | Tax compliance; tax administration; economics-of-crime approach; behavioral economics; technological changes; digitalization. |
| JEL: | C9 H26 H83 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:2208&r=iue |
| By: | Svraka, András (Tax Policy and Research Unit, Ministry of Finance) |
| Abstract: | In this paper we investigate what methodological and sampling factors can lead to widely different results on Hungarian tax compliance costs between recent studies based on standard cost models and representative firm level surveys. We validate the surveys' data on Hungarian administrative records and show that survey samples differ markedly from the total population of firms on key business indicators which could bias tax compliance estimates. Finally we adjust survey data to match administrative records and we account for the majority of the gap between enterprise tax compliance cost to turnover ratios from surveys studied in a decomposition exercise. |
| JEL: | C80 H29 M48 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:auo:moftwp:11&r=iue |
| By: | Ben Atta, Oussama; Chort, Isabelle; Senne, Jean Noël |
| Abstract: | This article assesses the impact of immigrant and asylum seeker in ows on the size of the informal sector in host countries from a macroeconomic perspective. We use two indicators of informality provided by Medina and Schneider (2019) and Elgin and Oztunali (2012) combined with migration data from the OECD Interna- tional Migration Database and data on asylum seeker ows from the UNHCR for the period 1997-2017. We estimate a first-difference model, instrumenting immi- grant and asylum seeker ows by their predicted values derived from the estimation of a pseudo-gravity model. Results suggest that both immigrant and asylum seeker in ows increase the size of the informal sector at destination, but the size of the effect is very small: a one percentage point increase in the stock of immigrants as a share of population leads to an increase of the informal sector as a share of GDP of 0.05-0.06 percentage points. Unsurprisingly, the effect is about four times larger for asylum seeker ows, but remains economically insignificant. We investigate several potential channels, and find that integration policies do matter. We find no impact of imported norms or institutions, but rather that the effect is larger in destination countries with a large informal sector. Finally, we estimate a VAR model and find that the impact of in ows on informality is long-lasting. |
| Keywords: | migration,informal economy,asylum seekers,integration policies,shadow economy |
| JEL: | F22 E26 J46 K37 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1197&r=iue |
| By: | Calderón Cerbón Mariana; Cortés Espada Josué Fernando; Pérez Pérez Jorge; Salcedo Alejandrina |
| Abstract: | In January 2019, the authorities increased the minimum wage and decreased the value-added tax (VAT) in an effort to boost activity on the northern Mexican border. In this paper we estimate the effects of both policies on prices. We find that the upward pressures on prices due to the minimum wage hike were more than offset by the downward pressures associated with the VAT. In the absence of the VAT reduction policy, average prices in the northern Mexican border would have been higher. We estimate that the effects of the minimum wage on prices tended to be smaller for goods or services produced with a larger share of informal labor. |
| Keywords: | Minimum wage;Value-Added Tax;Prices |
| JEL: | J38 J46 H20 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdm:wpaper:2022-13&r=iue |
| By: | Loyd Sungirirai; Henry Gurajena; Grace Gaolawole |
| Abstract: | Botswana's housing finance sector has undergone substantial transformations and growth over the past two decades from a relatively small banking sector dominated by commercial banks to ten commercial banks, four investment banks, two state-owned development finance organisations and one building society. The main aim of this research is to investigate available options for raising housing finance for low-income earners in Botswana. The study of this nature is important for the housing finance sector which is mostly represented by the banking sector as the formal system of housing finance, mostly through mortgage finance (Tomlison, 2006). According to (Tomlison, 2006) those that cannot afford a mortgage loan will at least be able to house themselves incrementally through the construction of houses. The study target population constituted the formally registered SACCOS and a sample from Gaborone was drawn for the semi-structured questionnaire which was utilised. The quantitive research approach used descriptive statistics to analyse the findings of this study. The research findings supports the noon that non-bank and informal finance systems provide small loans and small savings for housing finance. The informal systems include group-based savings collections such as Savings and Credit Cooperative Society (SACCOS), Internal Savings and Lending Schemes (ISLES) and microfinance firms that cover a wide range of community needs. ISLES serve economic and social purposes.SACCOS are an extension of Rotang Savings and Credi tAssociaon (ROSCAS). In Botswana, ISLES exist in various names depending with the community they are commonly popular amongst all and are referred to as motshelo, mahodisano in Setswana, and stokvels - membership is by individual periodic payments which can be weekly or monthly payment with an arrangement of peer lending and is different from microcredit but operate almost in the same way. This arrangement provide a safe financial inclusion especially for those in informal employment. |
| JEL: | R3 |
| Date: | 2022–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:afr:wpaper:2022-024&r=iue |
| By: | Hsi-Chuan Wang (University of Toronto) |
| Abstract: | Informal settlement growth across countries has led to distinctive actions that can enhance access for low-income populations to housing and basic services. This fact indicates the need to develop studies comparing countries and cities to identify policy learning opportunities. This paper is an experimental comparison between Accra, Ghana, and Buenos Aires, Argentina, investigating how policies on informal settlements have formed in the two countries. The two cities differ in the way that informal settlements are viewed by the public. In Argentina, the public often sees informal settlements (known as villas) as areas to be avoided, despite proactive policies to support and integrate low-income groups. In Accra, informal settlements may be viewed negatively or positively, depending on the characteristics and origin of their residents; some settlements are viewed as legitimate, ordinary communities that serve as transitional places despite their underdeveloped environment. Nevertheless, Buenos Aires, Argentina, demonstrates more inclusive policies for informal dwellers than Accra, Ghana. Argentina has chosen not to follow the market model, while Ghana maintains a neoliberal path. This difference is partly the result of a severe economic depression in Argentina in the early 21st century, coupled with institutional arrangements that give the city of Buenos Aires greater autonomy and leverage at the national level than Accra. In sum, Argentina could learn from Ghana about the way in which cultural barriers affect progress, while Ghana could learn from Argentina about removing structural and institutional barriers to improving the lives of those who live in informal settlements. |
| Keywords: | informal urban settlements, cultural variables, infrastructure, housing, comparative studies, Ghana, Argentina |
| JEL: | N90 H70 P25 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:mfg:wpaper:61&r=iue |
| By: | Joseph Awoamim Yacim; Mafhungo Musefuwa; Benita Zulch |
| Abstract: | The severity and extent of the challenges bedevilling the informal settlements are dissimilar because of the different geographical and contextual settings. Thus, using a common solution to the menace might not work in all contexts, without first, understudying the peculiar challenges of informal settlements within an area. Additionally, since the cause(s) of informal settlements varied considerably within a country and across countries, understanding the triggers relative to specific locations is necessary; to know what went wrong and how this could be remediated. Therefore, this study aims to, not only, evaluate the environmental challenges, but evaluate the triggers of the Msholozi informal settlement in South Africa. Accordingly, data for the study was collected from the residents, municipal officials, Departments of Human Settlements and Public Works officials. Whilst the results of this study have some commonalities with previous works, including, (1) an insalubrious living environment (2) overstretch of existing poor facilities (3) water and air pollution, and (4) block drainages and erosions among others; the triggers are fundamental. Findings imply that both the government and the dwellers are complicit in the development and challenges being faced thereof, in Msholozi. Thus, it is recommended that urgent and honest steps should be taken by concerned parties, toward remediating the menace. The steps should among others include (1) assemblage of stakeholders for a meeting to understand the genesis of the problem; (2) educating all parties on the consequences of their actions to the environment and the inhabitants; (3) promoting agreement among the stakeholders on their roles and responsibilities towards tackling the challenges; (4) taken the census of the residents to aid the government in decision making. |
| Keywords: | Environment; informal settlements; Msholozi; Pollution; Remediation |
| JEL: | R3 |
| Date: | 2022–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:afr:wpaper:2022-059&r=iue |