Evaluating policy approaches towards undeclared work: some lessons from Fyr of Macedonia

Colin C. Williams, Slavko Bezeredi

Abstract


To tackle undeclared work, the conventional rational economic actor approach uses deterrents to ensure that the costs of engaging in undeclared work outweigh the benefits. Recent years have seen the emergence of a social actor approach which focuses upon improving tax morale. To analyse the association between participation in undeclared work and these policy approaches, 2,014 face-toface interviews, conducted in FYROM in 2015, are reported. Logistic regression analysis reveals no association between participation in undeclared work and the perceived level of penalties and risk of detection, but there is an association with the level of tax morale. The paper concludes by discussing the implications for theory and policy.

Keywords


Informal Sector; Tax Morale; Tax Evasion; FYROM; South-East Europe; H26; J46; K34; K42; O17

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