THE CORONAVIRUS PANDEMIC AND EUROPE'S UNDECLARED ECONOMY: IMPACTS AND A POLICY PROPOSAL

Williams C. C., Kayaoğlu Yılmaz A.

SOUTH EAST EUROPEAN JOURNAL OF ECONOMICS AND BUSINESS, vol.15, no.1, pp.80-92, 2020 (ESCI) identifier identifier

  • Publication Type: Article / Article
  • Volume: 15 Issue: 1
  • Publication Date: 2020
  • Doi Number: 10.2478/jeb-2020-0007
  • Journal Name: SOUTH EAST EUROPEAN JOURNAL OF ECONOMICS AND BUSINESS
  • Journal Indexes: Emerging Sources Citation Index (ESCI), Scopus, IBZ Online, International Bibliography of Social Sciences, ABI/INFORM, Business Source Elite, Business Source Premier, Central & Eastern European Academic Source (CEEAS), EconLit, Directory of Open Access Journals
  • Page Numbers: pp.80-92
  • Keywords: coronavirus, COVID-19, informal economy, undeclared work, tax evasion, public policy, CROSS-NATIONAL VARIATIONS, INFORMAL EMPLOYMENT, LESSONS, PARTICIPATION, PREVALENCE, EMPLOYEES
  • Istanbul Technical University Affiliated: Yes

Abstract

The coronavirus pandemic has led to a loss of revenues for enterprises and workers due to workplace closures and restrictions on movement to 'flatten the curve'. In response, governments have made available temporary financial support to enterprises and workers affected. This paper evaluates a group currently excluded from this support, namely enterprises and workers in the undeclared economy, and a possible government policy response. To identify those involved, a 2019 Eurobarometer survey of undeclared work in Europe is reported. This reveals that one in every 132 European citizens relies wholly on undeclared earnings and the sectors and population groups involved. Given their reduced revenues and inability to access the temporary financial support, a voluntary disclosure initiative is recommended which brings undeclared enterprises and workers into the declared economy and onto the radar of state authorities by offering access to this temporary financial support if they disclose their previous undeclared work.