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on Informal and Underground Economics |
| By: | Talis Putnins (Finance Discipline Group, University of Technology Sydney); Arnis Sauka (Centre for Sustainable BusinessStockholm School of Economics in Riga); Adriana Ana Maria Davidesc (Department of Labour Market PoliciesNational Scientific Research Institute for Labour and Social Protection, Bucharest) |
| Abstract: | This report presents estimates of the size of the shadow economy in Moldova and Romania during the years 2015–2016. The estimates are based on surveys of entrepreneurs in both countries, following the method of Putninš and Sauka (Journal of Comparative Economics 43:471–490, 2015). The components of the shadow economy captured by this approach include misreported business income, unregistered or hidden employees, and ‘envelope’ wages. Our findings suggest that both Moldova and Romania exhibit high levels of bribery, which is influenced by the number of unregistered companies. The results of this chapter highlight the importance of focusing on different forms of entrepreneurship particularly in transition economies. |
| Date: | 2019–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:uts:ppaper:2019-1&r=all |
| By: | Salvador Barrios (European Commission - JRC); Diego d'Andria (European Commission - JRC); Maria Gesualdo (European Commission - JRC) |
| Abstract: | The reform proposal of the European Commission for a Common Consolidated Corporate Tax Base, the so-called CCCTB, is expected to significantly reduce the cost of doing business by lowering tax compliance costs for cross border operations within the European Union. However, to date the scarcity of comparable estimates on tax compliance costs has limited the assessment of such reduction. We exploit recently released and unique survey data designed to provide comparable information on corporate tax compliance costs in order to assess the impact of the CCCTB, using a general equilibrium modelling approach. Our results suggest that the reduction in tax compliance costs implied by the CCCTB would be associated with greater economic efficiency, including increases in both welfare and GDP. Member States resulting with the lowest compliance costs before the reform and having large inward foreign investment stock would benefit more from the CCCTB. Cross-border business operations would also benefit more from the CCCTB compared to domestic ones. The impact of the CCCTB on non-EU countries such as the US and Japan would be limited. |
| Keywords: | CCCTB, tax compliance costs, European Union |
| JEL: | H20 H30 C68 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:taxref:201902&r=all |
| By: | Helio Mau-Quei (University of Waikato); Michael P. Cameron (University of Waikato) |
| Abstract: | This study analyzes the characteristics of people working in the informal sector in Timor-Leste. We use primary data, collected from the field between January and early May 2017. A stratified random sample was used to draw a sample of 349 households, with a total of 658 adult respondents, from 38 Census Enumeration Areas in Dili and surrounding districts. A logistic regression model was used to identify the factors associated with informal sector participation. The analysis shows that 65.8 percent (n = 405) of individuals in our sample were engaged in the informal sector, including a significantly higher proportion of women than men. Education was significantly lower among those employed in the informal sector than those not employed in the informal sector. Married people were more likely to engage in the informal sector, while having no education and living in an urban area were marginally significant. Gender disaggregation shows that the impact of no education and urban area are only statistically significant for women. Moreover, analysis of economic activities performed in the informal sector actors revealed a gender dimension in the specific informal sector activities that participants were involved in. Women play a major role in food and beverage retail, as well as weaving and plaiting activities. Males dominate in occupations such as construction and quarrying activities. |
| Keywords: | informal sector; Timor-Leste |
| Date: | 2019–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:wai:econwp:19/05&r=all |
| By: | Teguh Dartanto (Department of Economics, Faculty of Economics and Business, Universitas Indonesia); Chairina Hanum Siregar (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)); Alvin Ulido Lumbanraja (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)); Usman (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)); Hamdan Bintara (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)); Wahyu Pramono (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)); Nia Kurnia Sholihah (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)) |
| Abstract: | One of the main challenges to Universal Health Coverage in developing countries like Indonesia is a high prevalence of those working in the informal sector that by the system they have to voluntarily register in the National Health Insurance System (NHIS) as Self Enroled Member. Therefore, challenges are administrative dif?culties in recruiting, registering and collecting regular contribution in the most of cost-effective way. This condition hinders some individuals for being covered NHIS. This research aims to analyze qualitatively some aspects that in?uence the decisions of individuals or households to join NHIS in Indonesia. By conducting in-depth interviews with some of the informants who were surveyed in 2014, and some new additional informants in the three selected regions of Deli Serdang, Pandeglang, and Kupang, the study found that regional socio-economic characteristics, demographics, culture and belief systems have varying degrees of in?uence on individual decisions to join the NHIS. The general pattern across all the regions reveals three main factors that in?uence the decisions of those working in the informal sector to join the NHIS: health conditions; family and peers; and existing knowledge and experience. High-risk individuals tend to join the NHIS through interactions with health workers, family members, and friends, concerning their illnesses or health risks. These groups tend to advocate NHIS as a means of reducing overall health expenses, particularly for expensive procedures. This creates an adverse selection problem and a pressing challenge for Social Security Agency for Health (SSAH) to attract healthy, young and low-risk groups in the informal sector to join the NHIS. The stories provided by the informants regarding their decision-making processes in joining NHIS also reveal the necessary and suf?cient conditions that enable informal sector workers to join the program. The necessary conditions are individual-speci?c and may differ between people, depending on individual characteristics, regional socio-economic and demographic characteristics, as well as belief systems. All the factors, apart from knowledge and experience, are necessary conditions for joining the NHIS, while knowledge and experience are suf?cient conditions that encourage informal sector (PBPU) to join NHIS. Without reliable information and knowledge about the NHIS, PBPU will not join NHIS, although they may like to join because of various individual factors. |
| Keywords: | NHIS — Universal Health Coverage — missing middle problem — informality — qualitative study — Indonesia |
| JEL: | I13 I14 I18 I3 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:lpe:wpaper:201933&r=all |