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Formal and informal institutions in the Western Balkans: who does what and why?

6:00 pm to 8:00 pm, 15 March 2019

South East European Seminar Series

This event is free.

Event Information

Open to

All

Availability

Yes

Cost

Free

Organiser

South East Europe Seminar Series

Location

347
SSEES
16 Taviton Street
London
WC1H 0BW

This talk will provide an overview of my research on tax evasion and undeclared work in the former communist countries. My main contribution is both theoretical and empirical. From an institutional perspective, I argue that for a better comprehension of noncompliant activities, one should consider both formal and informal institutions simultaneously. Doing so is particularly relevant for the Western Balkan countries, because institutional change has been a defining feature of their economies, hence “any inquiry into the causes and ultimate consequences of the transition must include an analysis of the incentives and sanctions governing various types of underground economic activities” (Feige, 1997). Empirically, I combine observational with laboratory data and examine the role of individuals’ attributes and attitudes about institutions on their engagement in informal activities, as well as the outcome of such engagement. My main conclusion is that people’s experience with the governing formal and informal institutions have important repercussions for the economy - a large informal sector; for the state - large budget deficits and hence lower investments in public goods; for personal well-being; and finally, for the overall society via institutional trust and social capital.

About the Speaker

Klarita Gërxhani

Professor and Chair in Sociology at Department of Political and Social Sciences, European University Institute, Florence

Klarita Gërxhani is Professor of (micro)Economic Sociology at the European University Institute, Florence, Italy. She received her PhD in Economics at the Tinbergen Institute and the Faculty of Economics and Business, University of Amsterdam. Her main expertise lies in the micro-foundations of economic sociology. Her research is interdisciplinary, combining laboratory and field experiments with field surveys and economic-sociological theory. She is the author of various articles published in internationally peer-reviewed journals, including the Annual Review of Sociology, Social Networks, PloS ONE, European Sociological Review, European Economic Review, Experimental Economics, Social Science Research, Journal of Institutional Economics, Journal of Economic Psychology, European Journal of Political Economy.