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Cross-National Variations in the Under-Reporting of Wages in South-East Europe: A Result of Over-Regulation or Under-Regulation?

Author

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  • Williams Colin

    (Management School, University of Sheffield, UK)

Abstract

This paper seeks to explain the cross-national variations in the tendency of employers in South East Europe to under-report the wages of their employees by paying them two wages, an official declared salary and an additional undeclared envelope wage. Reporting the results of a 2007 Eurobarometer survey of this practice undertaken in five South East European countries, the finding is that the commonality of this illicit wage practice markedly varies cross-nationally, with 23 percent of formal employees in Romania but just 3 percent in Cyprus receiving an under-reported salary. Finding that the under-reporting of wages is more prevalent in neo-liberal economies with lower levels of state intervention and less common in more ‘welfare capitalist’ economies in which there is greater state intervention in work and welfare, the resultant conclusion is that the under-reporting of employees wages by employers is correlated with the under- rather than over-regulation of work and welfare.

Suggested Citation

  • Williams Colin, 2012. "Cross-National Variations in the Under-Reporting of Wages in South-East Europe: A Result of Over-Regulation or Under-Regulation?," South East European Journal of Economics and Business, Sciendo, vol. 7(1), pages 53-61, April.
    • Handle: RePEc:vrs:seejeb:v:7:y:2012:i:1:p:53-61:n:5
    DOI: 10.2478/v10033-012-0005-7
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    Citations

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    Cited by:

    1. Krasniqi Besnik A. & Williams Colin C., 2017. "Explaining individual- and country-level variations in unregistered employment using a multi-level model: evidence from 35 Eurasian countries," South East European Journal of Economics and Business, Sciendo, vol. 12(2), pages 61-72, December.
    2. Colin C Williams & Junhong Yang, 2017. "Tackling falsely-declared salaries in Bulgaria: evidence from a 2015 survey," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 3, pages 333-351, September.
    3. Colin C. Williams & Ioana A. Horodnic, 2015. "Who Participates in the Undeclared Economy in South-Eastern Europe? An Evaluation of the Marginalization Thesis," South-Eastern Europe Journal of Economics, Association of Economic Universities of South and Eastern Europe and the Black Sea Region, vol. 13(2), pages 157-175.
    4. Colin C Williams & Slavko Bezeredi, 2017. "Explaining Consumers’ Motives for Purchasing from the Informal Economy: Some Lessons from a Study of Bulgaria, Croatia and FYR of of Macedonia," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 4, pages 515-531, December.
    5. Yu Hsing, 2013. "Testing The Trilemma Hypothesis And Measuring Their Effects On Inflation, Growth And Volatility For Poland," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 9(3), pages 57-64.
    6. Williams Colin C. & Kayaoglu Aysegul, 2020. "The Coronavirus Pandemic and Europe’s Undeclared Economy: Impacts and a Policy Proposal," South East European Journal of Economics and Business, Sciendo, vol. 15(1), pages 80-92, June.
    7. Williams Colin C. & Bezeredi Slavko, 2018. "Explaining and Tackling Under-Declared Employment in FYR Macedonia: The Employers Perspective," South East European Journal of Economics and Business, Sciendo, vol. 13(2), pages 19-31, December.

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