Artikel

Measuring disincentives to formal work

Evidence from transition economies shows that formal work may not pay, particularly for low-wage earners. Synthetic measurements of work disincentives, such as the formalization tax rate or the marginal effective tax rate, confirm a significant positive correlation between these measurements and the probability of informal work. These measures are especially informative for impacts at lower wage levels, where informality is highest. Policymakers who want to increase formal work can use these measurements to determine optimal labor taxation rates for low-wage earners and reform benefit design.

Sprache
Englisch

Erschienen in
Journal: IZA World of Labor ; ISSN: 2054-9571 ; Year: 2015 ; Bonn: Institute for the Study of Labor (IZA)

Klassifikation
Wirtschaft
Tax Evasion and Avoidance
Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
Thema
informal employment
synthetic measurements
tax wedge
tax evasion
formalization tax rate
marginal effective tax rate

Ereignis
Geistige Schöpfung
(wer)
Weber, Michael
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2015

DOI
doi:10.15185/izawol.213
Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Artikel

Beteiligte

  • Weber, Michael
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2015

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