Tackling Undeclared Work in the FYR of Macedonia: Knowledge-Informed Policy Responses
10 Pages Posted: 29 Aug 2017
Date Written: August 25, 2017
Undeclared work has deep roots in FYR of Macedonia. 1 in 16 adults and 1 in 8 of the employed engage in undeclared work. The use of informal connections to circumvent formal institutions is practiced by 35% of Macedonians. Formal institutions in the country are underdeveloped. Unemployment also remains unusually high compared with the EU average. The traditional repression approach to tackling undeclared work, which has been prioritised so far by the authorities, is ineffective. Increasing penalties and surveillance/control should at the very least be supplemented by public awareness raising campaigns, educating citizens, and the further modernisation of the state institutions. The government should increase spending on the socially excluded, including among the ethnic Albanians.
Keywords: informal economy, shadow economy, tax evasion, labor economics, informal sector
JEL Classification: H26, J46, J48, K34, K42, O17, P37
Suggested Citation: Suggested Citation