Informal sector, regulatory compliance, and leakage

Baksi, Soham; Bose, Pinaki

doi:10.1016/j.jdeveco.2016.03.008

Cited by 32 publications

(27 citation statements)

References 17 publications

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“…While one can envisage many policies that positively or negatively affect the formal sector, we consider a policy such as environmental regulations driving formal firms to informal activities (viz. in Baksi and Bose, 2016).…”

Section: Rent Seeking Equilibriummentioning

confidence: 99%

Seeking Rent in the Informal Sector

Kar¹,

Mandal

Marjit

et al. 2019

SSRN Journal

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Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world's largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author.

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Section: Rent Seeking Equilibriummentioning

confidence: 99%

Seeking Rent in the Informal Sector

Kar¹,

Mandal

Marjit

et al. 2019

SSRN Journal

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“…Therefore, the formal sector avoids the costly regulations by outsourcing part of its production to the informal sector. Baksi and Bose (2016) modeled this process and analyzed how stringent regulations affected the size and regulatory compliance status of an endogenous informal sector through the outsourcing decision of formal firms. This study also identified the conditions under which a partially compliant informal sector acted as a source of leakage by permitting the formal sector to outsource polluting production.…”

Section: Literature Reviewmentioning

confidence: 99%

Environmental quality and its nexus with informal economy, corruption control, energy use, and socioeconomic aspects: the perspective of emerging economies

Sultana

Rahman

Khanam

et al. 2022

Heliyon

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“…Second, pressures from rigorous environmental legislation motivate the formal rms to hide their polluting manufacturing into the underground sectors for cost-cutting (Mazhar and Elgin, 2013). This may shift the pollution from the formal sectors to the shadow economy (Baksi and Bose, 2016). Third, according to the three-sector general equilibrium framework, formal rms may purchase immediate goods from their informal counterparts, which are not subject to environmental taxes and standards (Chaudhuri and Mukhopadhyay, 2006).…”

Section: Theoretical Frameworkmentioning

confidence: 99%

The Shadow Economy-Environmental Quality Nexus In OECD Countries: Empirical Evidence From Panel Quantile Regression

Chu

Hoang

2021

Preprint

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This study explores the determinants of ecological footprint by integrating the influence of the shadow economy. The findings based on the panel quantile regression indicate that the environmental effects of the shadow economy, trade openness, energy intensity, renewable energy, and income are not homogeneous across various levels of ecological footprint. The shadow economy-ecological footprint nexus follows an inverted U-shaped pattern. Initially, the higher size of the informal economy leads to more ecosystem degradation. When the shadow economy increases to certain thresholds, its environmental impact reverts to benefit. Such threshold changes with the evolution of ecological footprint. Specifically, it first rises then decreases along with the degradation of the ecosystem. Moreover, the heterogeneous panel causality test reports the one-way directional running from the shadow economy to the ecological footprint in OECD countries. The significant and heterogeneous relationships between ecological footprint and its determining factors are also established.

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Informal sector, regulatory compliance, and leakage

Cited by 32 publications

References 17 publications

Seeking Rent in the Informal Sector

Seeking Rent in the Informal Sector

Environmental quality and its nexus with informal economy, corruption control, energy use, and socioeconomic aspects: the perspective of emerging economies

The Shadow Economy-Environmental Quality Nexus In OECD Countries: Empirical Evidence From Panel Quantile Regression

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