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on Informal and Underground Economics |
| By: | F. Atzori; V. Pelligra |
| Abstract: | Understanding the factors influencing people's choices in tax compliance decision-making is still important because tax evasion is a crucial issue for governments everywhere. This lab experiment investigates how social norms influence tax compliance behavior. We examine the effects of positive and negative empirical and normative expectations using the opinion-matching approach for measurement. According to our results, normative expectations—as opposed to empirical expectations—most strongly impact people's behavior. Surprisingly, positive empirical messages may have a negative effect, increasing tax evasion. Furthering our understanding of the causes of tax evasion, we also include a norm-following task to assess participants' propensity to adhere to norms. This study presents new viewpoints on tax compliance while replicating some established conclusions from previous research sheds new light on the interaction between tax compliance and social norms. |
| Keywords: | H26;E26;O17;D91;C92 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:202407&r=iue |
| By: | Claudio Deiana; Ludovica Giua; Roberto Nisticò |
| 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: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_11026&r=iue |
| By: | Lukas Delgado-Prieto; Andrea Otero-Cortés; Andrés Calderón |
| Abstract: | Hard discount stores (HDS) have changed the dynamics of the traditional retail sector by selling a basket of products at very low prices. This business model has gained significant market share in many countries, but little is known about its impact on the labor market. To fill this gap in the literature, in this paper we study the impact of the entry of hard discounters on local labor markets in Colombia. Making use of the staggered geographic expansion of major discount chains throughout the country as part of our empirical strategy and using information from different sources, such as administrative records on social security and household survey data, we analyze the impact of these stores on labor formality and tax collection. Our results show that the arrival of HDS in a municipality increases local formal employment, especially in retail, manufacturing and agriculture. This suggests that there are significant spillover effects from retail to other industries, as most of the goods sold by these stores are locally produced. As for the informal sector, increased competition between formal and informal businesses has no statistical effect on informal employment. However, there seems to be a decline in labor income of informal retailers, suggesting that the margin of adjustment is not through lower employment but via lower earnings. **** RESUMEN: Las tiendas de descuento duro (HDS por sus siglas en inglés) han cambiado las dinámicas del sector minorista tradicional al vender una canasta de productos a muy bajo precio. Este modelo de negocio ha ganado una importante cuota del mercado en muchos países, pero poco se conoce sobre su impacto en el mercado laboral. Para llenar este vacío en la literatura, en este trabajo estudiamos el impacto de la entrada de las tiendas de descuento duro en los mercados laborales locales de Colombia. Haciendo uso de la expansión geográfica escalonada de las principales cadenas de descuento por todo el país como parte de nuestra estrategia empírica y usando información de distintas fuentes, como registros administrativos sobre seguridad social y la encuesta de hogares, analizamos el impacto de estas tiendas sobre la formalidad laboral y recaudo de impuestos. Nuestros resultados muestran que la llegada de las HDS a un municipio aumenta el empleo formal local, sobre todo en los sectores del comercio minorista, la industria manufacturera y la agricultura. Esto sugiere que existen importantes efectos de derrame del comercio minorista a otros sectores económicos, ya que la mayoría de los bienes que venden estas tiendas son productos locales. En cuanto al sector informal, el aumento de la competencia entre comerciantes formales e informales no tiene efectos estadísticos sobre el empleo informal. No obstante, parece haber una disminución en los ingresos laborales de los minoristas informales, lo que sugeriría que el margen de ajuste no se da a través de menor empleo sino vía menores ingresos. |
| Keywords: | Hard discount stores, competition, local labor markets, informality, tiendas de descuento duro, competencia, mercados laborales locales, informalidad |
| JEL: | E24 J46 O17 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:bdr:region:326&r=iue |
| By: | Stansbury, Anna (MIT) |
| Abstract: | There is substantial evidence of minimum wage noncompliance in the US and the UK. In this paper, I compile new, comprehensive data on the costs minimum wage violators incur when detected. In both countries, the costs violators face upon detection are often little more than the money they saved by underpaying. To have an incentive to comply under existing penalty regimes, typical US firms would thus have to expect a 47%-83% probability of detection by the DOL, or a 25% probability of a successful FLSA suit. In the UK, typical firms would have to expect a 44%-56% probability of detection. Actual probabilities of detection are substantially lower than this for many firms, and would likely remain so even with realistic increases in enforcement capacity. Improved enforcement alone is thus insufficient: expected penalties must also substantially increase to ensure that most firms have an incentive to comply. |
| Keywords: | minimum wage, labor standards, compliance and enforcement, industrial relations |
| JEL: | J38 J58 K31 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16882&r=iue |
| By: | Rafael Pucci |
| Abstract: | This paper investigates the understudied phenomenon of urban land conflicts in contexts with weak enforcement of property rights. I examine, both theoretically and empirically, the use of arson as a violent tool to force slum removal from high-value land in cities. Leveraging fine-grained geocoded data, I employ panel regression and Difference-in-Differences analyses to demonstrate that the probability of slum fires dramatically increases with rising land prices. This effect is nonlinear and driven exclusively by slums situated on private lands, highlighting the role of high-powered incentives behind arson. These results illustrate how urban land conflicts can have different outcomes than their rural counterparts. |
| Keywords: | Urban Land Conflict; Slums; Arson; Violence; Property Rights |
| JEL: | K42 D74 O18 R10 |
| Date: | 2024–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:spa:wpaper:2024wpecon13&r=iue |