This paper studies labour market tax avoidance in the 2010s in Hungary, following major labour market tax reforms in the beginning of the decade. First we show that aggregate time series are broadly consistent with a "whitening" process, in which a higher fraction of incomes are declared....

This paper develops a four-sector equilibrium search and matching model with informal sector employment opportunities and educational choice. We show that underground activities reduce educational attainments if informal employment opportunities mainly are available for low-educated workers. A...

This Brief examines the dynamics between the informal economy and unemployment rates, the causes of informality, its consequences and potential reduction measures at both the theoretical and empirical level. Using Lithuania as a case study, this book tests the assumption that participation in...