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Evaluating the Extent and Nature of ‘Envelope Wages’ in the European Union: A Geographical Analysis

100%
Williams C., School of Management U. o. S.
European Spatial Research and Policy
|
2009
|
vol. 16
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issue 1
EN
To evaluate the spatialities of the illegal wage practice where employers pay their declared employees both an official declared wage and an undeclared ‘envelope’ wage so as to avoid tax liabilities, a 2007 survey conducted in 27 European Union (EU) member states is reported. The finding is that 5% of employees received envelope wages which amount on average to some two-fifths of their wage packet. Revealing how, although heavily concentrated in a small group of East-Central European nations, this wage practice is nonetheless ubiquitous, the paper concludes by discussing how this practice might be tackled.
2

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

86%
Williams C.
South East European Journal of Economics and Business
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2012
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vol. 7
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issue 1
53-61
EN
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.
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