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on Informal and Underground Economics |
| By: | Antonio Baez (Faculty of Economics, University of Barcelona) |
| Abstract: | The objective of this paper is to examine whether informal labor markets affect the flows of Foreign Direct Investment (FDI), and also whether this effect is similar in developed and developing countries. With this aim, different public data sources, such as the World Bank (WB), and the United Nations Conference on Trade and Development (UNCTAD) are used, and panel econometric models are estimated for a sample of 65 countries over a 14 year period (1996-2009). In addition, this paper uses a dynamic model as an extension of the analysis to establish whether such an effect exists and what its indicators and significance may be. While the results shows that informal labor markets are significant and do positively affect the flow of FDI, these effects are felt up to a certain level of informality, above which the effect becomes negative. The results are similar for developed and developing countries and are robust to several checks. |
| Keywords: | Foreign Direct Investment, Informal labor markets, Institutions. JEL classification: F16, F23, J8, M5 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201404&r=iue |
| By: | Akar, Gizem; Balkan, Binnur; Tumen, Semih |
| Abstract: | This paper documents two new facts linking firm-size and gender pay gaps to informal employment using micro-level data from Turkey. First, we show that the firm-size wage gap, defined as larger firms paying higher wages to observationally equivalent workers, is greater for informal employment than formal employment. And, second, we find that the gender pay gap is constant across different firm-size categories for formal employment, while it is a decreasing function of firm size for informal employment. These two facts jointly suggest that the informality status of a job is a valuable source of information in understanding the underlying forces determining firm-size and gender wage gaps. We propose and discuss the relevance of alternative mechanisms that might be generating these facts. |
| Keywords: | Informal employment; wage differentials; firm size; gender discrimination; THLFS. |
| JEL: | C21 E24 J31 J71 |
| Date: | 2014–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:53835&r=iue |
| By: | Sandro Casal; Luigi Mittone |
| Abstract: | When the phenomenon of tax evasion is discussed, both scholars and authorities agree on the fact that, although essential, classical enforcements are not enough to ensure tax compliance: some other forms of incentives must be adopted. The paper’s aim is to experimentally test the role of different non- monetary incentives for tax compliance: participants have been treated with different experimental conditions, which differ in the role played by anonymity. Indeed, subjects have been informed on the possibility of revealing their identity and their choices through the publication of their pictures, as a consequence of the result of the auditing process. As expected, anonymity plays an important role in the decision to pay taxes; in addition, we find that negative non-monetary incentive increases tax compliance more effectively than positive non-monetary incentive. We find also that the effect of these non-monetary incentives is mitigated, when too many information are made available. Finally, results show that, when evasion is made public, tax-dodgers are willing to pay in order to keep secret their cheating behavior and avoid public shame. |
| Keywords: | Tax Evasion, Non-monetary incentives, Anonymity, Experimental Economics |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwpce:1401&r=iue |
| By: | Andri Chassamboulli; Giovanni Peri |
| Abstract: | A key controversy in US immigration reforms is how to deal with undocumented workers. Some policies aimed at reducing them, such as increased border security or deportation will reduce illegal immigrants as well as total immigrants. Other policies, such as legalization would decrease the illegal population but increase the legal one. These policies have different effects on job creation as they affect the firm profits from creating a new job. Economists have never analyzed this issue. We set up and simulate a novel and general model of labor markets, with search and legal/illegal migration between two countries. We then calibrate it to the US and Mexico labor markets and migration. We find that policies increasing deportation rates have the largest negative effect on employment opportunities of natives. Legalization, instead has a positive employment effect for natives. This is because repatriations are disruptive of job matches and they reduce job-creation by US firms. Legalization instead stimulates firms' job creation by increasing the total number of immigrants and stimulating firms to post more vacancies some of which are filled by natives. |
| JEL: | E24 J15 J64 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19932&r=iue |
| By: | Nicolas Dias Gomes (Faculty of Economics, University of Coimbra and INESC-Coimbra, Portugal); Pedro André Cerqueira (Faculty of Economics, University of Coimbra and GEMF, Portugal); Luís Alçada Almeida (Faculty of Economics, University of Coimbra and INESC-Coimbra, Portugal) |
| Abstract: | As devices that used software became available to the masses the problem of software piracy arose. Recent theoretical works modeled the software piracy phenomenon; others tried to empirically explain the determinants that can explain this phenomenon. Empirical literature in the latter case is still in it´s infancy. This chapter reviews the theoretical literature focusing on three major models, those that deal with diffusion models, network externalities and with game theory. It also presents the empirical literature in which we identify eight stylized results that reflect key variables across five macroeconomic dimensions that explain software piracy: Economic, Cultural, Technological, Legal and Educational dimensions. |
| Keywords: | Software Piracy, Copyright, Intellectual Property Rights. |
| JEL: | C50 C70 D85 L86 O34 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:wpaper:2014-05.&r=iue |