The Dark Side of the Labour Market: Institutional Change, Economic Crisis and Undeclared Work in Greece during the Crisis

Abstract

Recent scholarly work has shifted its attention from the prevalence of the shadow economy in less developed country contexts, towards an examination of the incidence of undeclared work within developed European economies. However, little is known about the interaction between institutional changes and their interplay with the informal sector of the labor market. This study attempts a first empirical examination of the incidence and prevalence of undeclared work in the case of Greece during the economic recession. It unpacks the different manifestations of this phenomenon, namely, the under-declaration of employment, the false declaration of employment and the non-payment of wages or salaries. It is argued that the state and civil morality framework as well as the changing power dynamics in the labor market can help explain to a large extent the prevalence and proliferation of undeclared work during the crisis.