The Shadow Economy and Morals: A Note
AbstractIf the established rules are obeyed spontaneously in an economy, this increases economic efficiency since the uncertainties, monitoring costs and incentive problems induced by opportunism can be avoided. Opportunism will be increasedby increasing the incentives for unlawful behaviour, however, and a slight increase in these incentives might cause a cumulative and self-nourishing breakdown of morals. The dangers of the growing shadow economy are louring here.
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This item is provided by University of Munich, Department of Economics in its series Chapters in Economics with number 3140.
shadow economy; business morality; critical mass; taxation; tax compliance;
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