ANALYZING THE DETERMINANTS OF THE INFORMAL ECONOMY IN MENA REGION
Journal Title: Asian Journal of Management Sciences and Education - Year 2018, Vol 7, Issue 1
Abstract
The consequences of informal economy is of utmost important for policy makers, and the issue attracts some scholars to identify the effective factors on informal economy. We find that unemployment rate, corruption level, GDP per capita and trade openness are highly significant in MENA region with expected sign. However, although some researchers has focused on taxation, our results show that the tax burden does not play a crucial role in informal economy in MENA region. To diminish the size of informal economy we suggest the governments in this region introduce the value added tax which is an effective way as stepping stone for developing holistic efficient tax system.
Authors and Affiliations
Gholamali Farjadi, Ehsan Mohaghegh Dowlatabadi
Keywords
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