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Explaining Cross-National Variations in the Prevalence and Character of Undeclared Employment in the European Union

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  • Williams Colin C.

    (Sheffield University Management School, University of Sheffield, Conduit Road, S10 1FL Sheffield, United Kingdom)

Abstract

The aim of this article is to evaluate the competing theories that variously explain the greater prevalence of undeclared employment in some countries either as: a legacy of under-development; a result of the voluntary exit from declared employment due to the high taxes, state corruption and burdensome regulations and controls, or a product of a lack of state intervention in work and welfare which leads to the exclusion of workers from the declared economy and state welfare provision. Analyzing the cross-national variations in the prevalence of, and reasons for, undeclared employment across the European Union using evidence from a 2007 Eurobarometer survey, the finding is that undeclared employment is less prevalent and more of the voluntary variety in wealthier, less corrupt and more equal societies possessing higher levels of social protection and redistribution via social transfers. The theoretical and policy implications are then discussed.

Suggested Citation

  • Williams Colin C., 2014. "Explaining Cross-National Variations in the Prevalence and Character of Undeclared Employment in the European Union," European Spatial Research and Policy, Sciendo, vol. 21(2), pages 115-131, December.
    • Handle: RePEc:vrs:eusprp:v:21:y:2014:i:2:p:115-131:n:8
    DOI: 10.1515/esrp-2015-0008
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    References listed on IDEAS

    as
    1. Lars P. Feld & Friedrich Schneider, 2010. "Survey on the Shadow Economy and Undeclared Earnings in OECD Countries," German Economic Review, Verein für Socialpolitik, vol. 11(2), pages 109-149, May.
    2. Jaanika Meriküll & Karsten Staehr, 2010. "Unreported Employment and Envelope Wages in Mid-Transition: Comparing Developments and Causes in the Baltic Countries," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 52(4), pages 637-670, December.
    3. Birgit Pfau‐Effinger, 2009. "Varieties of Undeclared Work in European Societies," British Journal of Industrial Relations, London School of Economics, vol. 47(1), pages 79-99, March.
    4. repec:bla:germec:v:11:y:2010:i::p:109-149 is not listed on IDEAS
    5. Williams Colin, 2009. "Evaluating the Extent and Nature of ‘Envelope Wages’ in the European Union: A Geographical Analysis," European Spatial Research and Policy, Sciendo, vol. 16(1), pages 115-129, June.
    6. Charles Woolfson, 2007. "Pushing the envelope: the `informalization' of labour in post-communist new EU member states," Work, Employment & Society, British Sociological Association, vol. 21(3), pages 551-564, September.
    7. Friedrich Schneider & Andreas Buehn & Claudio Montenegro, 2010. "New Estimates for the Shadow Economies all over the World," International Economic Journal, Taylor & Francis Journals, vol. 24(4), pages 443-461.
    8. Rainer Neef, 2002. "Aspects of the Informal Economy in a Transforming Country: The Case of Romania," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 26(2), pages 299-322, June.
    9. Friedrich Schneider (ed.), 2011. "Handbook on the Shadow Economy," Books, Edward Elgar Publishing, number 13432.
    10. Andreas Buehn & Friedrich Schneider, 2012. "Shadow economies around the world: novel insights, accepted knowledge, and new estimates," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 19(1), pages 139-171, February.
    11. Williams Colin & Nadin Sara & Windebank Jan, 2012. "Evaluating the Prevalence and Nature of Self-Employment in the Informal Economy: Evidence From a 27-Nation European Survey," European Spatial Research and Policy, Sciendo, vol. 19(1), pages 129-142, July.
    12. Lars P. Feld & Claus Larsen, 2012. "Undeclared Work, Deterrence and Social Norms," Springer Books, Springer, edition 127, number 978-3-540-87401-0, June.
    13. Pauline Dibben & Colin C. Williams, 2012. "Varieties of Capitalism and Employment Relations: Informally Dominated Market Economies," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 51, pages 563-582, April.
    14. Ted London & Stuart L Hart, 2004. "Reinventing strategies for emerging markets: beyond the transnational model," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(5), pages 350-370, September.
    15. Ali Nobil Ahmad, 2008. "Dead men working: time and space in London's (`illegal') migrant economy," Work, Employment & Society, British Sociological Association, vol. 22(2), pages 301-318, June.
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    Cited by:

    1. Colin C. Williams, 2023. "A Modern Guide to the Informal Economy," Books, Edward Elgar Publishing, number 18668.
    2. Ignatov Augustin, 2019. "Entrepreneurship and Bureaucracy: Impact upon Innovation and Economic Competitiveness of the European Union," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 22(72), pages 36-59, June.

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