nep-iue New Economics Papers
on Informal and Underground Economics
Issue of 2016‒09‒04
four papers chosen by
Catalina Granda Carvajal
Universidad de Antioquia

  1. Relative Tax Rates, Proximity and Cigarette Tax Noncompliance: Evidence from a National Sample of Littered Cigarette Packs By Shu Wang; David Merriman; Frank J. Chaloupka
  2. The effect of foreign institutional ownership on corporate tax avoidance: international evidence By Hasan, Iftekhar; Kim, Incheol; Teng, Haimeng; Wu, Qiang
  3. Mining and Energy Boom, Dutch Disease and Informality in Colombia: a DSGE Approach By Carlos Ballesteros
  4. Análisis experimental de la evasión en Colombia By Ana Paola Cruz Rodríguez; Alvin Alejandro Olarte

  1. By: Shu Wang; David Merriman; Frank J. Chaloupka
    Abstract: We analyze data about cigarette tax compliance from the first national scale littered cigarette packs collection. We code each pack based on whether an appropriate tax had been paid at the location where it was found. Noncompliance across our 132 sample communities ranges from zero to one hundred percent with an appropriately weighted mean of 21 percent. We provide evidence that noncompliance is due to both cross-border shopping and cigarette trafficking. OLS and binomial logit regressions demonstrate that the financial incentive for non-compliance is the most important explanatory variable and has a statistically and quantitatively significant impact on noncompliance.
    JEL: H26 I12
    Date: 2016–08
  2. By: Hasan, Iftekhar; Kim, Incheol; Teng, Haimeng; Wu, Qiang
    Abstract: This study examines whether foreign institutional investors (FIIs) help explain variation in corporate tax avoidance and whether mechanisms such as tax morality, investment horizon, and corporate governance underlie the relation between FIIs and tax avoidance. We find robust evidence that FIIs are negatively associated with corporate tax avoidance. Moreover, this negative association is dominated by FIIs from countries with high tax morality, FIIs with long-term investment horizons, and FIIs from countries with high corporate governance quality. We conclude that FIIs play an active role in shaping corporate tax avoidance policy.
    Keywords: tax avoidance, foreign institutional ownership, tax morale, investment horizon, corporate governance
    JEL: G23 G32 H26 M41
    Date: 2016–08–23
  3. By: Carlos Ballesteros
    Abstract: The paper develops a Dynamic Stochastic General Equilibrium (DSGE) model, which assesses the macroeconomic and labor market effects derived from simulating a positive shock to the stochastic component of the mining-energy sector productivity. Calibrating the model for the Colombian economy, this shock generates a whole increase in formal wages and a raise in tax revenues, expanding total consumption of the household members. These facts increase non-tradable goods prices relative to tradable goods prices, then real exchange rate decreases (appreciation) and occurs a displacement of productive resources from the tradable (manufacturing) sector to the non-tradable sector, followed by an increase in formal GDP and formal job gains. This situation makes the formal sector to absorb workers from the informal sector through the non-tradable formal subsector, which causes informal GDP to go down. As a consequence, in the net consumption falls for informal workers, which leads some members of the household not to offer their labor force in the informal sector but instead they prefer to keep unemployed. Therefore, the final result on the labor market is a decrease in the number of informal workers, of which a part are in the formal sector and the rest are unemployed.
    Keywords: Mining and energy boom, dutch disease, formal and informal sectors, unemployment, DSGE model
    JEL: E0 E1 E2 E3
    Date: 2016–08–01
  4. By: Ana Paola Cruz Rodríguez; Alvin Alejandro Olarte
    Abstract: La presente investigación tiene como objetivo analizar si tasas mayores de sanción inciden en el comportamiento de evasión fiscal de los declarantes. Para lograr tal cometido, a partir de la metodología experimental, se obtiene una primera aproximación que procede a examinar los datos provenientes de una muestra de estudiantes universitarios. El diseño del experimento introduce los costes psicológicos de la estructura clásica asociados al incumplimiento por medio de un procedimiento de inspección y sanción en dos tipos de tratamiento: un Sistema Débil (SD) con una tasa de sanción menor a la de un Sistema Fuerte (SF), aunque con igual probabilidad de inspección en los dos. Los resultados sugieren que no existe una diferencia significativa entre los montos declarados entre un sistema y otro, lo que concuerda con una tendencia a la evasión en el país, tema ya abordado por diferentes estudios. Sin embargo, el aporte individual total, que se compone de declaraciones y sanciones, sí es significativamente mayor en el SF, aspecto tocado superficialmente en las recomendaciones dadas por la Comisión de Expertos para la Equidad y Competitividad Tributaria, quienes proponen básicamente crear un código tributario, ampliar la base y aumentar las tasas impositivas.
    Keywords: evasión, sanción, economía experimental, política fiscal.
    JEL: C91 E62 H26
    Date: 2016–08–26

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