The paper extends the standard tax evasion model by allowing for social interactions. In Manski’s (1993) nomenclature, our model takes into account social conformity effects (i.e., endogenous interactions), fairness effects (i.e., exogenous interactions) and sorting effects (i.e., correlated...

Children are seldom accounted for in household behavioural models. They are usually assumed to have neither the capacity nor the power to influence the household decision process. The literature on collective models has so far incorporated children through the "caring preferences" of their...

This paper investigates the effect of working in the underground sector on the level of individual underground expenditures. We show that it can be decomposed into a network effect, a non-separability effect and an income effect. Our empirical analysis uses micro data from a randomized survey...

Recently, a new theoretical framework has been proposed to analyze the behavior of households composed of two adults. This approach, usually referred to has the “collective model”, assumes that spouses have distinct preferences and that household decisions are Pareto efficient. So far, most...

Children are seldom accounted for in household behavioural models. They are usually assumed to have neither the capacity nor the power to influence the household decision process. The literature on collective models has so far incorporated children through the caring preferences of their parents...

This paper tests the unitary and the collective household labor supply models within a structural framework. A nonlinear unrestricted household labor supply system is postulated and the set of parametric restrictions imposed by each model is derived. The authors' results generally reject the...

Recent theoretical work on labor supply has shown that the tax and transfer system can induce some individuals to work in the irregular labor market. Models designed to represent such behavior are unable to sign unambiguously the impact of the marginal tax rate as well as many key exogenous...

We investigate the impact of working in the underground sector on the demand for underground commodities. Using a tax evasion model with costly information, we show that the presence of a network effect encourages underground workers to purchase underground commodities. The model is estimated...