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on Informal and Underground Economics |
| By: | Barth, Erling (Institute for Social Research); Cappelen, Alexander W. (Dept. of Economics, Norwegian School of Economics and Business Administration); Ognedal, Tone (Universitetet i Oslo, Økonomisk institutt) |
| Abstract: | In this paper we analyse how fairness considerations, in particular considerations of just income distribution, affect whether or not people find tax evasion justifiable and their willingness to evade taxes. Using data from the Norwegian “Hidden Labour Market Survey” we show that individuals with low hourly wages and long working hours have a higher probability of justifying tax evasion. These are individuals that arguably are treated unfairly in a tax system that taxes an individual’s total income without taking into account how many hours the individual has worked. The same individuals are also more willing and likely to take home income without reporting it to the tax authorities. The results are consistent with a model in which individuals make a trade-off between economic gains and fairness considerations when they make decisions about tax evasion. Taken together our results suggest that considerations of fair income distribution are important for the analysis of tax evasion. |
| Keywords: | Tax evasion; redistributive taxation; fair income distribution. |
| JEL: | D63 H26 |
| Date: | 2013–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2013_011&r=iue |
| By: | Suresh de Mel; David McKenzie; Christopher Woodruff |
| Keywords: | Private Sector Development - E-Business Finance and Financial Sector Development - Microfinance Finance and Financial Sector Development - Debt Markets Macroeconomics and Economic Growth - Climate Change Economics Small Scale Enterprise Industry |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:10053&r=iue |
| By: | Armagan-Tuna Aktuna Gunes (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne); Carla Canelas (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne) |
| Abstract: | In this paper, we study the links between time use, informal labor market, and poverty measures in two countries that strongly differ on their level of development, by means of a multidimensional poverty index, and a bivariate probit model to assess the changes in the joint probability of working in the informal sector while being considered poor. |
| Keywords: | Poverty; informality; time use |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00820754&r=iue |
| By: | Christoph Bühren (University of Kassel); Torben C. Kundt (University of the Federal Armed Forces) |
| Abstract: | WWith the help of a real effort experiment, we analyze if tax evasion depends on the amount of effort invested to generate income. In three treatments, subjects were either endowed with income or had to work moderately or hard to earn it. In line with prospect theory, subjects evaded more taxes when they worked hard for their income. We find little evidence for the prediction that tax evasion in the endowed treatment is higher than in the moderate work treatment. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201326&r=iue |
| By: | Rawaa Harati (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne) |
| Abstract: | This paper provides historical and empirical arguments that can explain the development of the Egyptian informal sector. After recalling the various approaches proposed in the literatures, it identifies the configuration that overrides the Egyptian labor market by allowing for the heterogeneity of informal jobs and therefore the existence of different segments within the informal sector using a mixture model. It concludes that the Egyptian informal labor market in 2006 was composed of two segments with a distinct wage equations. This may point to the existence of barriers to entry to each sector, e.g. fixed cost related to social stigma which prevent people from working in the sector which offers them the highest expected wage. |
| Keywords: | Informal market; development economics; finite mixture model; Egypt; segmentation; selection bias |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00820783&r=iue |
| By: | Jaramillo, Miguel (Grupo de Análisis para el Desarrollo (GRADE)) |
| Abstract: | La aplicación del salario mínimo (SM) en el Perú, conocido desde 1985 como remuneración mínima vital (RMV), se justifica como una herramienta para reducir la desigualdad laboral. Sin embargo, este estudio -que evalúa los efectos del SM sobre dos importantes variables del mercado laboral: ingresos y empleo en la década del 2000- muestra un piso salarial peruano que ha variado en la misma dirección que la tasa de incumplimiento; es decir, mientras más elevada fue la RMV respecto del salario promedio, más se incumplió. El SM no eleva las remuneraciones de los que ganan menos porque no tiene efecto sobre aquellos que ganan por debajo de este piso salarial, ni sobre los trabajadores del sector informal. Sobre el empleo, sus efectos se concentran en el sector informal y en trabajadores que ganan por encima del SM. No se encuentra evidencia de un impacto general en los salarios causado por el crecimiento del SM –llamado efecto “faro”–; por el contrario, estos efectos tienden a ser bastante focalizados. Tampoco hay efectos significativos sobre la probabilidad de mantener el empleo para los trabajadores que ganan alrededor del salario mínimo; sin embargo, tendrá un efecto positivo para los asalariados informales. Este efecto es de tal magnitud que impacta al grupo de asalariados como conjunto. De los resultados, se concluye que la RMV no es un instrumento efectivo para promover la inclusión social. |
| Keywords: | Mercado de trabajo, Salario mínimo, Análisis econométrico, América Latina, Perú, Labour market, Minimum wage, Econometric analysis, Latin America, Peru |
| JEL: | J30 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:gad:doctra:dt63&r=iue |
| By: | World Bank |
| Keywords: | Social Protections and Labor - Labor Markets Finance and Financial Sector Development - Microfinance Finance and Financial Sector Development - Debt Markets Finance and Financial Sector Development - Access to Finance Small Scale Enterprise Industry |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:13252&r=iue |
| By: | Anita Alves Pena (Colorado State University) |
| Abstract: | While a stated goal of minimum wage increases is to benefit low-income workers, some employers are not obligated to provide at least minimum wages to all employees. U.S. farm employers comprise one of these groups. Employees of large farms and H2-A workers (temporary nonimmigrant workers lawfully admitted to perform temporary or seasonal agricultural services) are protected by minimum wage legislation, while other migrant workers (especially those who are paid piece rate) are exempt. Furthermore, U.S. agriculture is characterized by a large percentage of illegal migrants, and workers who are illegal may or may not receive wages above minimum levels. This paper presents a case study, drawing from agriculture, that examines if and how minimum wage laws affect uncovered workers. Analysis examines wages and hours worked as functions of federal and state minimum wages using data from a nationally and regionally representative survey of employed farm workers. Results suggest wage increases for both covered and uncovered workers, greatest gains to those who are formally covered, and gains not being at the expense of hours worked. |
| Keywords: | minimum wage exemptions, poverty, agriculture |
| JEL: | I32 J33 Q12 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:upj:weupjo:13-194&r=iue |