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on Informal and Underground Economics |
| By: | Guillermo Cruces (University of Nottingham); Dario Tortarolo (Institute for Fiscal Studies); Gonzalo Vazquez-Bare (UC Santa Barbara) |
| Date: | 2022–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:22/32&r=iue |
| By: | Katherine Baer; Ruud A. De Mooij; Shafik Hebous; Michael Keen |
| Abstract: | Policymakers are struggling to accommodate cryptocurrencies within tax systems not designed to handle them; this paper reviews the issues that arise. The greatest challenges are for implementation: crypto’s quasi-anonymity is an inherent obstacle to third-party reporting. Design problems arise from crytocurrencies’ dual nature as investment assets and means of payment: more straightforward is a compelling case for corrective taxation of carbon-intensive mining. Ownership is highly concentrated at the top, but many crypto investors have only moderate incomes. The capital gains tax revenue at stake worldwide may be in the tens of billions of dollars, but the more profound risks may ultimately be for VAT/sales taxes. |
| Keywords: | cryptocurrency, virtual assets, tax evasion, tax compliance, Bitcoin |
| JEL: | E62 H25 H32 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10372&r=iue |
| By: | Domenico Buccella; Luciano Fanti; Luca Gori |
| Abstract: | In a Cournot duopoly with indirect taxes evasion, this paper counter-intuitively shows that, in the presence of unions, a higher indirect taxation may increase profits because taxes reduce wage claims. This result is likely to occur if the market size is adequately large and the detection probability is not too high. Moreover, unionisation 1) leaves unaltered the absolute while reduces the relative tax evasion; and 2) increases tax revenue. As consumer and social welfare are unaffected by taxation, the policy implication is that higher taxes (which are always revenue-enhancing) ultimately lead to a redistribution from wages to profits. |
| Keywords: | Tax Evasion, Sales Tax, Cournot duopoly, Unions |
| JEL: | H20 H25 H26 J5 |
| Date: | 2023–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2023/293&r=iue |
| By: | Paolo Pinotti (Bocconi University); Diogo G. C. Britto (Bocconi University); Alexandre Fonseca (Federal Revenue of Brazil); Breno Sampaio (Universidade Federal de Pernambuco); Lucas Warwar (Universidade Federal de Pernambuco) |
| Abstract: | We provide the first estimates of intergenerational income mobility for a developing country, namely Brazil. We measure formal income from tax and employment registries, and we train machine learning models on census and survey data to predict informal income. The data reveal a much higher degree of persistence than previous estimates available for developed economies: a 10 percentile increase in parental income rank is associated with a 5.5 percentile increase in child income rank, and persistence is even higher in the top 5%. Children born to parents in the first income quintile face a 46% chance of remaining at the bottom when adults. We validate these estimates using two novel mobility measures that rank children and parents without the need to impute informal income. We document substantial heterogeneity in mobility across individual characteristics - notably gender and race - and across Brazilian regions. Leveraging children who migrate at different ages, we estimate that causal place effects explain 57% of the large spatial variation in mobility. Finally, assortative mating plays a strong role in household income persistence, and parental income is also strongly associated with several key long-term outcomes such as education, teenage pregnancy, occupation, mortality, and victimization. |
| Keywords: | Intergenerational Mobility, Inequality, Brazil, Migration, Place Effects |
| JEL: | J62 D31 I31 R23 |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:2223&r=iue |
| By: | Murat Demirci (Koç University); Murat Güray Kırdar (Boğaziçi University) |
| Abstract: | Turkey hosts the largest population of refugees globally; however, we know little about their labor market outcomes at the national level. We use the 2018 round of the Turkey Demographic and Health Survey, which includes a representative sample of Syrian refugees in Turkey for the first time, to examine a rich set of labor market outcomes. We find that the native-refugee gap in men’s employment in Turkey (in favor of natives) is much smaller than that reported for most developed countries. Moreover, men’s employment peaks quite early (one year) after arrival and remains there, whereas women’s employment is lower to begin with and changes little over time. Once we account for demographic and educational differences, the native-refugee gap in men’s (women’s) paid employment reduces to 4.7 (4.0) percentage points (pp). These small gaps conceal the fact that refugees’ formal employment is much lower. Even after accounting for the covariates, refugee men’s formal employment rate is 58 pp lower. In addition, the native-refugee gap is the smallest in manufacturing for men and in agriculture for women, and the gap is also much smaller in wage employment than self-employment and unpaid family work for both genders. Young refugees are more likely to work than natives, whereas the gap favors natives among the prime-age working people. Moreover, the native-refugee gap in employment widens for more educated refugees. Finally, accounting for the differences in covariates, the native-refugee gap in men’s employment vanishes for Turkish-speaking refugees but persists for Arabic- and Kurdish-speaking refugees. |
| JEL: | F22 J21 J61 O15 |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:2138&r=iue |