Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/51683 
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dc.contributor.authorFortin, Bernarden
dc.contributor.authorLacroix, Guyen
dc.contributor.authorPinard, Dominiqueen
dc.date.accessioned2011-10-18-
dc.date.accessioned2011-11-23T11:32:52Z-
dc.date.available2011-11-23T11:32:52Z-
dc.date.issued2010-
dc.identifier.urihttp://hdl.handle.net/10419/51683-
dc.description.abstractThe main purpose of this paper is to estimate the size and the growth of Quebec's underground economy, and the corresponding loss of taxes for the government. Our approach is based on a method developed by Pissarides and Weber (1989) and extended by Lyssiotou et al. (2004). The basic hypothesis is that individuals can under-report their earnings from self-employment but not from paid work, from which taxes are directly deducted. We estimate a consumer demand system in which the marginal propensity to consume is allowed to vary with the two types of earnings. We next estimate the amount of self-employment earnings that are under-reported. From this estimate, we calculate the relative size of the underground economy in Quebec. We use data from Statistics Canada's Survey of Household Spending. According to our results, Quebec's underground economy amounted to 4.6% of GDP in 1997 and increased slightly to 5.7% in 2002. For the government, this represents approximately $ 3.3 billion in forgone taxes for the year 2002. This estimate is very close to those reported by Gervais (1994) and Fortin and Lacroix (2009) using very different estimation methods and data.en
dc.language.isoengen
dc.publisher|aInstitute for the Study of Labor (IZA) |cBonnen
dc.relation.ispartofseries|aIZA Discussion Papers |x5384en
dc.subject.jelD12en
dc.subject.jelE26en
dc.subject.jelH26en
dc.subject.ddc330en
dc.subject.keywordunderground economyen
dc.subject.keyworddemand systemen
dc.subject.keywordhousehold behavioren
dc.subject.keywordgeneralized method of momentsen
dc.subject.keywordtax evasionen
dc.subject.keywordincome from self-employmenten
dc.titleEvaluation of the underground economy in Quebec: A microeconomic approach-
dc.typeWorking Paperen
dc.identifier.ppn670112437en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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