nep-iue New Economics Papers
on Informal and Underground Economics
Issue of 2022‒05‒09
seventeen papers chosen by
Catalina Granda Carvajal
Universidad de Antioquia

  1. Informal employment and the social contract: An individual-level perspective By Mariya Aleksynska; Emilie Wojcieszynski
  2. Promoting self-employment: Does it create more employment and business activity? By Gilbert Cette; Jimmy Lopez
  3. The dynamics of the informal economy in West Africa: Case of Mali By Asmaa Chouhaibi
  4. Rethinking Entrepreneurship within the Informal Sector in Morocco in the Post-Covid-19 era: For a Prospective Approach to Integrative Formalization By L Alla; E Jaouhari; Badr Bentalha
  5. Fiscal Consolidation Plans with Underground Economy By Maria Ferrara; Elisabetta Marzano; Monica Varlese
  6. The political economy of big data leaks: Uncovering the skeleton of tax evasion By Pier Luigi Sacco; Alex Arenas; Manlio De Domenico
  7. Legalization and Long-Term Outcomes of Immigrant Workers By Deiana, Claudio; Giua, Ludovica; Nistico, Roberto
  8. Urban Exclusion: Rethinking Social Protection in the Wake of the Pandemic in India By Pallavi Choudhuri; Santanu Pramanik; Sonalde Desai
  9. Impacto de la maternidad en la trayectoria laboral de las mujeres . Evidencia para Uruguay By Martina Querejeta
  10. COVID-19 e a proteção social no Sul da Ásia: Afeganistão By Beatriz Burattini
  11. COVID-19 e a Proteção Social no Sul da Ásia: Sri Lanka By Isabela Franciscon; Pedro Arruda
  12. COVID-19 e a proteção social no Sul da Ásia: Bangladesh By Fabianna Bacil; Gabriel Soyer
  13. COVID-19 e a proteção social no Sul da Ásia: Butão By Krista Joosep Alvarenga; Fábio Veras Soares
  14. COVID-19 e a Proteção Social no Sul da Ásia: Nepal By Isabela Franciscon; Pedro Arruda
  15. COVID-19 e a proteção social no Sul da Ásia: India By Fabianna Bacil; Gabriel Soyer
  16. COVID-19 e a proteção social no Sul da Ásia: Maldivas By Krista Joosep Alvarenga
  17. COVID-19 e a Proteção Social no Sul da Ásia: Paquistão By Yannick Markhof; Khurram Arif

  1. By: Mariya Aleksynska; Emilie Wojcieszynski
    Abstract: This paper empirically tests whether individual-level informality status is linked to a weak social contract, as measured through individual perceptions of its various aspects. Accounting for workers’ heterogeneity and a possible simultaneity between informality status and attitudes towards institutions, the paper shows that informal workers are systematically more dissatisfied with the social contract, as compared to formal workers. The paper enriches the literature by looking at a broad range of aspects of the social contract. The results show that informality is associated with a lower level of confidence in labour unions, in parliament, in civil services; a lower satisfaction with the healthcare system, the way the government performs its duties, the quality of healthcare, and the city setting. The paper concludes with some policy implications. Cet article teste empiriquement si le fait de travailler de manière informelle peut être lié à une défiance personnelle vis-à-vis du contrat social. En tenant compte de l'hétérogénéité des travailleurs et d'une possible concomitance entre le statut d'informalité et les attitudes envers les institutions, l'article montre que les travailleurs informels ont systématiquement plus de défiance vis-à-vis du contrat social que les travailleurs formels. L'article complète la littérature existante en examinant de nombreux aspects du contrat social. Les résultats montrent que l'informalité s'avère être liée à une défiance envers les syndicats, le parlement, les services publics; à une satisfaction moins élevée à l'égard du système de santé, de la manière dont le gouvernement remplit ses fonctions, de la qualité des soins de santé et des aménagements urbains. Le document conclut sur les implications en matière de politiques publiques.
    Keywords: informality, institutions, social contract
    JEL: E26 D63 J21 N35 O17 P16
    Date: 2022–04–27
    URL: http://d.repec.org/n?u=RePEc:oec:devaaa:348-en&r=
  2. By: Gilbert Cette (NEOMA - Neoma Business School); Jimmy Lopez (DGEI-DEMS - Banque de France - Direction Générale des Etudes et des relations Internationales, Direction des Etudes Microéconomique et Structurelles , LEDi - Laboratoire d'Economie de Dijon [Dijon] - UB - Université de Bourgogne - UBFC - Université Bourgogne Franche-Comté [COMUE])
    Abstract: We assess the economic impact of reforms promoting self-employment in the three countries that have implemented such reforms since the early 2000s: the Netherlands, the United Kingdom and France. To that end, we use an unbalanced cross country-industry dataset of 4,226 observations, including 12 OECD countries and 20 market industries, over the 1995-2016 period. We first observe, using country-level data, that the share of self-employed workers in total employment is quite stable or declines over the period in all countries in our dataset, except in the three countries where large reforms promoting self-employment have been implemented, and only after these reforms. We econometrically confirm this impact on self-employment in our set of 20 industries and we find that, at the end of the period, the reforms may have increased the share of selfemployed workers in total employment by 5.5pp on average in the Netherlands, 2.5pp in the United Kingdom and 2pp in France. Then, we investigate the impact of reforms on total employment and value added using a difference-indifferences approach. In spite of a broad sensitivity analysis, we find no evidence that the reforms may have impacted either total employment or value-added. These results suggest that the reforms promoting self-employment may have raised the number of self-employed workers, but mostly through a substitution effect between the self-employed and employees, and not through a supply effect or a substitution effect with informal activities. This means that the reforms may have failed to achieve their main objectives.
    Keywords: self-employment,structural reforms,entrepreneurship
    Date: 2021–09
    URL: http://d.repec.org/n?u=RePEc:hal:journl:hal-03588286&r=
  3. By: Asmaa Chouhaibi (Université Mohammed V)
    Abstract: All the economies of the world are made up of a more or less formal part and another more or less informal. The relative share of each of these parts depends on the level of economic and social development of the country, the more the economy and the society develop and modernize, the more the share of the informal economy is reduced. The informal economy has gradually become a fertile field of study that attracts the attention and interest of university researchers, development research centers, national governments and also international organizations. Like the other regions of Africa, all the studies show that the share of the informal economy is relatively large in West African countries, which prompted us to study the case by taking as an inventory the country of Mali. This work analyzes the spread and development of the informal economy in West Africa in general and its emergence in the country of Mali in particular, of which we will first present the general and economic situation of the country, then we will proceed to the description of the informal economy in Mali by the presentation of the figures, and this in order to be able to identify its share and its importance in the economy of the country, and to draw at the end the main conclusions of the said situation
    Abstract: Toutes les économies du monde se composent d'une partie plus ou moins formelle et d'une autre plus ou moins informelle. La part relative de chacune de ces parties est en fonction du niveau de développement économique et social du pays, plus l'économie et la société se développent et se modernisent, plus la part de l'économie informelle se réduit. L'économie informelle est devenue progressivement un champ d'études fertile qui attire l'attention et l'intérêt des chercheurs universitaires, des centres de recherche dédiés au développement, des pouvoirs publics nationaux et aussi des organismes internationaux. A l'instar des autres régions de l'Afrique, toutes les études démontrent que la part de l'économie informelle est relativement importante au sein des pays d'Afrique de l'Ouest, ce qui nous a inciter à étudier le cas en prenant comme état des lieux le pays du Mali. Le présent travail analyse la propagation et le développement de l'économique informelle en Afrique de l'Ouest en générale et son émergence au pays du Mali en particulier, dont on va présenter d'abord la situation générale et économique du pays, ensuite on va procéder à la description l'économie informelle au Mali par la présentation des données chiffrées, et ce pour pouvoir dégager sa part et son importance dans l'économie du pays, et tirer à la fin les principales conclusions de ladite situation.
    Keywords: Mali,West Africa,development,Informal economy,Afrique de l'Ouest,développement,Economie informelle
    Date: 2022
    URL: http://d.repec.org/n?u=RePEc:hal:journl:hal-03563680&r=
  4. By: L Alla (ENSAF - École nationale des sciences appliquées de Fès = National School of Applied Sciences of Fez); E Jaouhari (EST Khenifra - Sultan Moulay Sliman University); Badr Bentalha (ENCGF - Ecole Nationale de Commerce et de Gestion De Fès - USMBA - Université Sidi Mohamed Ben Abdellah)
    Abstract: Several studies have led to the conclusion that entrepreneurial dynamics in the sector are more related to a variety of reasons or motivations than to subjective ones. Aside from the illegal sphere of this economy, understanding such dynamics, prompting entrepreneurs to evolve in the informal economy and stimulating their resilience at the edge of the modern economy. With the Covid-19 pandemic, some informal enterprises have demonstrated, more than others, significant capacities for crisis resilience, more creativity and innovation, more organization and networking, yet struggling in a hostile environment and without any state support. How else can the business model of informal sector entrepreneurship be approached to better approach its integrative formalization? This is our research problem. Based on a review of the literature, we first try to identify the concept, the approaches to informal entrepreneurship and the theoretical determinants of entrepreneurial dynamics in the sector by proposing a standard profile. Then, we present the reference models of structuring-formalization of the sector, and propose a theoretical framework, to be refined by contextualization within the framework of the Moroccan economy. The research proposals thus identified will be examined through semi-directive interviews with entrepreneurs operating in the informal sector. The objective of this study is to contribute to a good understanding of the causes of the resilience of these entrepreneurs, the levers to be mobilized to succeed in the formalization process.
    Abstract: Plusieurs travaux ont abouti à ce que la dynamique entrepreneuriale dans le secteur est davantage liée à une panoplie de raisons ou motivations tant que subjective. A part la sphère illégale de cette économie, la compréhension d'une telle dynamique, incitant les entrepreneurs à évoluer dans l'économie informelle et stimulant leur résilience à la lisière de l'économie moderne. Avec la pandémie du Covid-19, certaines entreprises informelles ont fait preuve, plus que d'autres, d'importantes capacités de résistance à la crise, de plus créativité et d'innovation, de plus d'organisation et de réseautage, pourtant aux prises avec un environnement hostile et ne pouvant compter sur aucune aide de l'État. Comment peut-on appréhender autrement le business model de l'entrepreneuriat du secteur informel pour mieux approcher sa formalisation intégrative ? Telle est notre problématique de recherche. A partir d'une revue de littérature, nous tentons d'abord de cerner le concept, les approches de l'entrepreneuriat informel, les déterminants théoriques de la dynamique entrepreneuriale dans le secteur via la proposition d'un profil-type. Ensuite, nous présentons les modèles de référence de structuration-formalisation du secteur, et en proposer une trame théorique, à affiner par contextualisation dans le cadre de l'économie marocaine. Les propositions de recherche ainsi dégagées seront étudiées examinées par des entretiens semidirectifs avec les entrepreneurs opérant dans l'informel. L'objectif de cette étude est de contribuer à la bonne compréhension des causes de la résilience de ces entrepreneurs, les leviers à mobiliser pour réussir le processus de formalisation.
    Keywords: économie informelle,entrepreneuriat informel,résilience informelle,déviance,formalisation
    Date: 2022–01–01
    URL: http://d.repec.org/n?u=RePEc:hal:journl:hal-03581639&r=
  5. By: Maria Ferrara; Elisabetta Marzano; Monica Varlese
    Abstract: Fiscal consolidation literature often neglects that there are economies with a sizable underground sector and that most of time it is accounted in GDP statistics. This produces non negligible effects on fiscal multipliers. This paper explores a fiscal consolidation plan calling for a downsizing of the underground sector as well. The analysis refers to the Italian economy that, among European countries, is the second for high public debt and has one of the highest size of tax evasion. Results show that it is possible to both reduce public debt and tax evasion through a temporary cut in public spending associated with a permanent drop in tax rates. In this context a reallocation of resources from the underground to market sector operates.
    Keywords: fiscal consolidation plans, underground economy, DSGE modelling
    JEL: E26 E32 E62 E63 H26
    Date: 2022
    URL: http://d.repec.org/n?u=RePEc:ces:ceswps:_9622&r=
  6. By: Pier Luigi Sacco; Alex Arenas; Manlio De Domenico
    Abstract: After the leak of 11.5 million documents from the Panamanian corporation Mossack Fonseca, an intricate network of offshore business entities has been revealed. The emerging picture is that of legal entities, either individuals or companies, involved in offshore activities and transactions with several tax havens simultaneously which establish, indirectly, an effective network of countries acting on tax evasion. The analysis of this network quantitatively uncovers a strongly connected core (a rich-club) of countries whose indirect interactions, mediated by legal entities, form the skeleton for tax evasion worldwide. Intriguingly, the rich-club mainly consists of well-known tax havens such as British Virgin Islands and Hong Kong, and major global powers such as China, Russia, United Kingdom and United States of America. The analysis provides a new way to rank tax havens because of the role they play in this network, and the results call for an international coordination on taxation policies that take into account the complex interconnected structure of tax evaders in a globalized economy.
    Date: 2022–02
    URL: http://d.repec.org/n?u=RePEc:arx:papers:2202.13417&r=
  7. By: Deiana, Claudio (University of Essex); Giua, Ludovica (European Commission, DG Joint Research Centre); Nistico, Roberto (University of Naples Federico II)
    Abstract: This paper establishes a new fact about immigration policies: legalization has long-term effects on formal employment of undocumented immigrants and their assimilation. We exploit the broad amnesty enacted in Italy in 2002 together with rich survey data collected in 2011 on a representative sample of immigrant households to estimate the effect of regularization in the long run. Immigrants who were not eligible for the amnesty have a 14% lower probability of working in the formal sector a decade later, are subject to more severe ethnic segregation on the job and display less linguistic assimilation than their regularized counterparts.
    Keywords: undocumented immigrants, amnesty program, formal employment, discrimination, segregation
    JEL: J15 J61 K37
    Date: 2022–03
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp15189&r=
  8. By: Pallavi Choudhuri (National Council of Applied Economic Research); Santanu Pramanik (National Council of Applied Economic Research); Sonalde Desai (National Council of Applied Economic Research)
    Abstract: The COVID-19 pandemic, and the consequent nationwide lockdown in India that began on March 25, 2020, caused a major disruption in the labour market, leading to the widespread loss of livelihoods and food insecurity. The findings from a telephonic survey of a representative sample of more than 3,000 households in the National Capital Region (NCR) also reveal a dramatic loss in earning capacity. The place of residence and occupation mediated the impact of the lockdown, with greater vulnerabilities witnessed amongst those engaged in informal employment, especially in urban areas. The Government rolled out a series of welfare measures in response to the widespread economic distress, with the provision of free foodgrains and cash transfers aimed at rehabilitating those who were the most affected. While the use of prior social registries enabled quick disbursement, our analysis points to the presence of unmet need, with such exclusion being exacerbated in the urban areas. The findings also reveal that the likelihood of receiving benefits increases with improvements in targeting at the local level and is vital for building social registries.
    Keywords: Informal Employment, Income, Social Protection, COVID-19, India
    JEL: I38 J21 O17
    Date: 2022–03–03
    URL: http://d.repec.org/n?u=RePEc:nca:ncaerw:135&r=
  9. By: Martina Querejeta
    Abstract: La maternidad ha sido señalada como un factor explicativo de la persistencia de las brechas laborales de género. A través de la metodología de estudio de eventos, en este trabajo se estima el impacto de la maternidad en la trayectoria laboral de las mujeres para Uruguay. Con base en registros administrativos de historias laborales del Banco de Previsión Social para los años 1996 a 2015, se define el evento como el mes de inicio del primer subsidio maternal y se estudian los efectos dinámicos de la maternidad para mujeres ocupadas en la actividad privada formal que se encontraban empleadas durante el año previo a la ocurrencia del evento. Los resultados obtenidos muestran una importante penalización por maternidad en el empleo formal, en particular, a partir del mes de finalización del subsidio. El empleo se reduce 30% al año de la maternidad y esta penalización no logra revertirse, sino que continúa en aumento, y el efecto acumulado de la maternidad alcanza una reducción del 60% en el empleo formal luego de 10 años. Estas penalizaciones de largo plazo son sustancialmente más grandes que las encontradas en la literatura revisada, lo cual puede deberse a que la reducción del empleo formal abarca tanto la reducción del empleo, como la migración desde empleos formales a empleos informales que es importante para países en desarrollo con fuerte presencia del sector informal.
    Keywords: brecha de género, maternidad, empleo formal, estudio de eventos, Uruguay.
    JEL: J13 J16
    Date: 2020–07
    URL: http://d.repec.org/n?u=RePEc:ude:wpaper:0220&r=
  10. By: Beatriz Burattini (IPC-IG)
    Keywords: social protection; COVID-19; emergency response; informal workers; Afghanistan
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:447&r=
  11. By: Isabela Franciscon (IPC-IG); Pedro Arruda (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Sri Lanka
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:454&r=
  12. By: Fabianna Bacil (IPC-IG); Gabriel Soyer (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Bangladesh
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:448&r=
  13. By: Krista Joosep Alvarenga (IPC-IG); Fábio Veras Soares (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Butão.
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:449&r=
  14. By: Isabela Franciscon (IPC-IG); Pedro Arruda (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Nepal
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:452&r=
  15. By: Fabianna Bacil (IPC-IG); Gabriel Soyer (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; India
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:450&r=
  16. By: Krista Joosep Alvarenga (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Maldivas
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:451&r=
  17. By: Yannick Markhof (IPC-IG); Khurram Arif (IPC-IG)
    Keywords: proteção social; COVID-19; resposta emergencial; trabalhadores informais; Paquistão
    Date: 2020–12
    URL: http://d.repec.org/n?u=RePEc:ipc:opport:453&r=

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