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on Informal and Underground Economics |
| By: | Chalendard, Cyril |
| Abstract: | This paper aims to identify some factors that reduce evasion of customs duties in developing countries. Following the recent literature on customs evasion, we proxy customs fraud by discrepancies in bilateral trade statistics. Estimates first show that the more frequently a product is imported, the more customs fraud reduces. We argue that this result is indicative of the fact that customs officers use what they have learned from similar import declarations - use customs' internal information - to better assess the compliance of declarations. Then, we show that relying on an information provider - a pre-shipment inspection company in our case - seems to increase tax enforcement. Results indicate that pre-shipment inspections significantly reduce observed discrepancies in trade statistics. In line with previous studies, we find that the semi-elasticity of evasion increases with the tax rate. Finally, estimates confirm that enforcement is product-varying. Results are robust to various robustness checks. |
| Keywords: | Development Policy, Economic Development, Governance, |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:12783&r=iue |
| By: | Joël CARIOLLE (Ferdi); Cyril CHALENDARD (Cerdi - Université d'Auvergne); Anne-Marie GEOURJON (Ferdi); Bertrand LAPORTE (FERDI) |
| Abstract: | Over the last few years, customs authorities in many developing countries have introduced modern risk management techniques relying on data mining and statistical scoring techniques. By demonstrating that risk analysis in customs may be a valuable tool to facilitate legal trade and combat fraud more effectively, these techniques have helped improving the performance of customs authorities. However, these risk management techniques may prove to be inefficient in a context of moral hazard and low-performance customs administration. One way to address this weakness is to rely on information gained from discrepancies in bilateral trade statistics. The analysis of discrepancies in bilateral trade statistics (or mirror analysis) is increasingly used to identify high-risk import operations and to estimate revenue losses. By comparing data on fraud recorded by the Gabon customs administration with discrepancies in Gabon’s bilateral trade data, this paper highlights the benefits for a customs administration of a joint analysis of fraud records and mirror trade statistics data, the latter being indicative of the fraud remaining to be detected. Such an analysis helps customs to target ex post audits on risky import declarations unadjusted by the frontline customs officer. Finally, we point that analyzing jointly data on fraud records and mirror trade statistics data may be useful to (i) identify imported products for which the fraud remaining to be detected is large and (ii) monitor the performance of customs inspections. |
| Keywords: | douanes, administration douanière, évasion fiscale, fraude, analyse miroir |
| JEL: | H26 H83 K42 D73 F13 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:3346&r=iue |
| By: | Mascagni, Giulia; Monkam, Nara; Nell, Christopher |
| Abstract: | This paper is the first in a series of three studies looking at tax compliance using administrative data from Rwanda. It discusses the use of administrative data for tax research – specifically anonymised taxpayers records, which have become increasingly available on the African continent. The paper starts by critically summarising the key advantages and disadvantages of using this data for tax research in Africa. It proceeds to illustrate these opportunities and challenges in practice, using the case of Rwanda for application of the data to analyse tax compliance and progressivity. By doing this it shows some stylised facts – for example that tax systems designed to be progressive can still be regressive in practice, that a great share of tax revenue is generated by a few very large taxpayers, and that some taxpayers face a negligible probability of being audited. Although these results are specific to Rwanda, they are in line with the situation in other low-income countries in Africa. |
| Keywords: | Development Policy, Economic Development, Governance, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:12800&r=iue |
| By: | Mascagni, Giulia; Nell, Christopher; Monkam, Nara; Mukama, Denis |
| Abstract: | Large-scale field experiments on tax compliance have been a thriving field of research in many regions of the world. However, Africa is still lagging behind, as administrative data from anonymised returns is available only in a handful of countries. To the best of our knowledge, there is as yet no published evidence of a tax field experiment from Africa. This paper reports the results of a pilot experiment in Rwanda that served as a stepping stone for a larger experimental study on tax compliance. In this pilot, we test the process of messaging taxpayers to encourage them to comply voluntarily, by providing information on sanctions. The results indicate that communication strategies that aim to inform taxpayers may be effective in increasing tax compliance. However, these results are only indicative. They will be complemented by further evidence from the larger field experiment, where we test different types of messages and delivery methods. Nonetheless, this paper provides some initial insight into the use of tax experiments in Africa, both in terms of initial evidence and lessons learned for future efforts in this field. |
| Keywords: | Development Policy, Economic Development, Governance, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:12798&r=iue |
| By: | McCluskey, Rhiannon |
| Abstract: | This brief summarises the findings from five ICTD working papers produced from a research project conducted by the ICTD in partnership with the African Tax Administration Forum and in collaboration with the Rwanda Revenue Authority. It includes information about the value of administrative data and tax experiments for research and policy, as well as the results of two field experiments on tax compliance, which tested the effectiveness of different types of communications with taxpayers. |
| Keywords: | Development Policy, Economic Development, Governance, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:12782&r=iue |
| By: | Lohse, Tim; Dwenger, Nadja |
| Abstract: | We study whether individuals in a face-to-face situation can successfully exert some lying effort to delude others. We exploit data from a laboratory experiment in which participants were asked to assess videotaped statements as being rather truthful or untruthful. The statements are face-to-face tax declarations which were recorded in an incentivised tax compliance experiment. The video clips to be assessed feature each subject twice making the same declaration. But one time the subject is reporting truthfully, the other time willingly untruthfully. This allows us to investigate within-subject differences in trustworthiness. Drawing on more than 18,000 assessments, we find that a subject is perceived as more trustworthy if she deceives than if she reports truthfully. It is particularily individuals with dishonest appearance who manage to increase their perceived trustworthiness by up to 15 percent. This is evidence of individuals successfully exerting lying effort. |
| JEL: | C91 H31 K42 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc16:145616&r=iue |
| By: | Yesegat, Wollela Abehodie; Fjeldstad, Odd-Helge |
| Abstract: | tax; compliance; perceptions; attitudes; rates; audit; penalty. |
| Keywords: | Economic Development, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:11203&r=iue |
| By: | Mascagni, Giulia |
| Abstract: | Tax experiments have been gaining momentum in recent years, although this literature dates back several decades. With new developments in methods and data availability, tax experiments have gradually moved away from lab settings and towards the field. This movement from the lab to the field has happened against the background of the ‘credibility revolution’ in applied economics, which has seen more rigorous methods applied to policy relevant questions, and of the availability to researchers of administrative data from tax returns. These developments have allowed significant advances in the experimental literature on tax compliance. This paper reviews this literature, giving particular attention to field experiments using administrative data, but putting them in the broader context of the compliance literature. A particular effort is made to take a global perspective, in a literature that is only recently seeing the emergence of evidence from Africa, Latin America and Asia. |
| Keywords: | Governance, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:8967&r=iue |
| By: | Mia Ellis; Margaret McMillan; Jed Silver |
| Abstract: | Despite Tanzania’s rapid recent growth, the vast majority of employment creation has been in informal services. This paper addresses the role that different subsectors of formal and informal services have played in Tanzania’s growth. It finds that subsectors such as trade services contribute significantly to employment despite their relatively low productivity, while subsectors such as business and transportation services display higher productivity and improve the environment for other firms to operate.The paper also acknowledges the role of high-performing small and medium-sized service firms and the tourism sector in contributing further to Tanzania’s growth and structural change. |
| Keywords: | services, informal sector, economic growth, structural change, Tanzania, tourism |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2017-16&r=iue |
| By: | Herrera, Catalina (Northeastern University); Sahn, David E. (Cornell University); Villa, Kira M. (University of New Mexico) |
| Abstract: | Women represent the majority of informal sector workers in developing countries, especially in Sub-Saharan Africa where adolescent pregnancy rates are high. Little empirical evidence exists concerning the relationship between teen fertility and the likelihood that a woman will be employed in the informal sector. Using a panel survey in Madagascar designed to capture the transition from adolescence to adulthood, we estimate a multinomial logit model to capture the effect of the timing of first birth on female selection into four categories: non-participation, informal, formal, and student. To address the endogeneity of fertility and labor market outcomes, we instrument the timing of first birth using young women's community-level access, and duration of exposure to family planning. Our results suggest that motherhood increases the probability of employment for young women and that women whose first birth occurs during adolescence largely select into low-quality informal jobs. This effect is partially, but not entirely, mediated by the effect of teen pregnancy on schooling. |
| Keywords: | fertility, informal sector, adolescence, female labor force participation, Madagascar |
| JEL: | J13 J24 O1 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10464&r=iue |
| By: | Joël CARIOLLE (Ferdi); Cyril CHALENDARD (Cerdi - Université d'Auvergne); Anne-Marie GEOURJON (Ferdi); Bertrand LAPORTE (FERDI) |
| Abstract: | Les administrations douanières des pays en développement mettent en œuvre depuis plusieurs années des méthodes d’analyse et de gestion du risque à partir des données issues des systèmes informatiques de dédouanement, afin d’orienter les contrôles de première ligne vers les différents circuits de dédouanement. Ces projets ont contribué à promouvoir un changement de culture au sein des administrations concernées en démontrant l’intérêt de recourir aux techniques d’analyse de données. Une des principales faiblesses de ces initiatives est toutefois d’évaluer les risques de fraude uniquement à partir des infractions relevées par les agents des douanes. Dans un contexte d’aléa moral, la portée de l’exercice et sa fiabilité peuvent être limitées, justifiant d’élargir la démarche en recourant à d’autres sources d’informations. Plusieurs études utilisent les écarts observés dans les données miroir du commerce international pour identifier les déclarations frauduleuses et en estimer leurs effets. A partir des données douanières du Gabon et de celles du commerce international, ce document de travail montre les avantages qu’une administration douanière tire simultanément de l’analyse de ses propres données sur les infractions constatées et de l’exploitation des données miroirs qui donnent une idée de la fraude non encore détectée. L’analyse des données miroirs permet d’établir un programme de contrôles a posteriori en ciblant les contrôles sur les opérations à risque qui ont échappé aux contrôles de première ligne. De plus, ces deux sources de données peuvent être combinées pour suivre la performance des contrôles douaniers et identifier les produits sur lesquels l’administration devrait concentrer ses efforts. |
| Keywords: | douanes, administration douanière, évasion fiscale, fraude, analyse miroir |
| JEL: | H26 H83 K42 D73 F13 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:3344&r=iue |