Tax Policies and Interaction between Hidden and Official Economy

Johan Graafland

Public Finance = Finances publiques, 1990, vol. 45, issue 1, 75-89

Abstract: This paper combines a macroeconomic framework and a microeconomic analysis to estimate the effects of tax policies on the interaction between the hidden economy and the official economy in the Netherlands. Simulation results show that general tax policies of the government have little influence on the size of the hidden economy. More specific tax policies, like a differentiated reduction of value added taxes on labor-intensive goods are more effective to reduce the size of the hidden economy. The influence of the hidden economy on the official economy is small because substitution effects are partly offset by contrary income effects.

Date: 1990
References: Add references at CitEc
Citations: View citations in EconPapers (4)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pfi:pubfin:v:45:y:1990:i:1:p:75-89

Access Statistics for this article

More articles in Public Finance = Finances publiques
Bibliographic data for series maintained by Christopher F. Baum ().