The monetary method to measure the shadow economy: The forgotten problem of the initial conditions

Hildegart Ahumada, Facundo Alvaredo () and Alfredo Canavese

Economics Letters, 2008, vol. 101, issue 2, pages 97-99

Abstract: We show that when the money demand function used to estimate the size of the shadow economy includes the lagged dependent variable, the need to assume a known initial condition reappears as it was the case in the early monetary methods.

Keywords: Underground; economy; Informality; Monetary; method (search for similar items in EconPapers)
Date: 2008

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Persistent link: http://EconPapers.repec.org/RePEc:eee:ecolet:v:101:y:2008:i:2:p:97-99

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