The Complex Dynamics of Social Interactions

J. Barkley Rosser

Chapter Chapter 3 in Foundations and Applications of Complexity Economics, 2021, pp 53-68 from Springer

Abstract: Abstract How large the non-observed economy (NOE) is and what determines its size in different countries and regions of the world is a much studied question (Schneider and Enste, 2000, 2002). The size of this sector in an economy has important ramifications. It negatively affects a nation’s ability to collect taxes to support its public sector, which can lead more economic agents to move into the non-observed sector (Johnson et al. 1997). When this sector is associated with criminal or corrupt activities it may undermine social capital and broader social cohesion (Putnam et al. 1993), which may damage economic growth (Knack and Keefer, 1997; Zak and Knack, 2001). Furthermore, as international aid programs are tied to official measures of the size of economies, these can be distorted by wide variations in the relative sizes of the NOE across different countries, especially among the developing economies.

Date: 2021
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DOI: 10.1007/978-3-030-70668-5_3

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