The main objective of the research is to assess the tax, economic, behavioral, and social factors affecting informal employment in retail in Ukraine. Key behavioral factors are reputational risks for citizens, the level of corruption, the quality of state institutions, and the prevalence of bribery. The key economic factors are inflation, the tax burden, and the minimum wage level. The model includes five blocks: the retail block, the tax and budget system block, the tax administration and state institutions block, the informal employment block, and the business climate block. The block of retail calculates the main economic indicators of the model, the block of taxes calculates state finances, the block of state institutions, and the block of informal employment calculates the factors affecting informal employment in retail in Ukraine. The relationship between the factors and informal employment is through effects based on the literature review and the author's assumptions. The main policies are the introduction of tax reform, the improvement of anti-corruption policy, the strengthening of the government's social policy, and the minimum wage policy. According to the simulations, informal employment shows an increase due to the war, but due to economic recovery and increased government efficiency, the amount of informal employment will decrease.Master's Thesis in System DynamicsGEO-SD351INTL-MNINTL-HFINTL-SVINTL-JUSMASV-SYSDYINTL-MEDINTL-KMDINTL-PSY
