Measuring True Sales and Underreporting with Matched Firm-Level Survey and Tax-Office Data

Zhou, Fujin ; Oostendorp, Remco

关键词: AGENCY COSTS;    BANK CREDIT;    BANK LOANS;    BANK POLICY;    BOND;   

DOI  :  10.1596/1813-9450-5628
RP-ID  :  WPS5628

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper uses firm-level survey datamatched with official tax records to estimate the unobservedtrue sales of formal firms in Mongolia. Taking into accountfirm-level incentives to comply with taxes and a productionfunction technology linking unobserved true sales withobservable firm-level production characteristics, theauthors derive a multiple-indicators, multiple-causes modelpredicting unobserved true sales. Comparing predicted truesales with sales reported to the tax office, the analysisfinds that 38.6 percent of firm-level sales areunderreported. It also finds evidence that firm-level surveydata suffer from significant underreporting. Finally, thepaper compares this approach with two alternative approachesto measuring underreporting by firms.