The underreporting of income by self-employed workers in Spain

• Diego Martinez-Lopez ^[1]
  1. [1] Universidad Pablo de Olavide

     Universidad Pablo de Olavide

     Sevilla, España

     
• Localización: SERIEs : Journal of the Spanish Economic Association, ISSN 1869-4195, Vol. 4, Nº. 4, 2013, págs. 353-371
• Idioma: inglés
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• Resumen

  • This paper offers estimates of the underreporting of income by self-employed workers using the Spanish household surveys over the period 2006–2009. We replicate the well-known approach by Pissarides and Weber (J Public Econ 39(1):17–32, 1989) but extending its interpretation for admitting also the concealment of income by salary workers. Our results show that the reported income by self-employed has to be increased by about 25 % to obtain the level of income which would equal the level of underreporting by employees. Our estimates are robust to changes in specification, endogeneity and non-linearities.