Underground economy and aggregate fluctuations

Juan Carlos Conesa, Carlos Diaz Moreno and Jose Galdon-Sanchez ()

No 17, Working Papers in Economics from Universitat de Barcelona. Espai de Recerca en Economia

Abstract: This paper explores the role of underground economic activities as an explanation for cross-country differences in registered aggregate fluctuations. In order to do so, we develop a two-sector Real Business Cycle model calibrated to the USA economy. In our model, individuals will participate or not in registered economic activities according to the wage premium, i.e. the ratio of average wages to the minimum wage. Our main result is that exogenously specified differences in the wage premium could account for the high range of registered aggregate fluctuations found across countries.

JEL-codes: E24 E32 (search for similar items in EconPapers)
Pages: 0 pages
Date: 1997
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Underground economy and aggregate fluctuations (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bar:bedcje:199717

Access Statistics for this paper

More papers in Working Papers in Economics from Universitat de Barcelona. Espai de Recerca en Economia Espai de Recerca en Economia, Facultat de Ciències Econòmiques. Tinent Coronel Valenzuela, Num 1-11 08034 Barcelona. Spain.. Contact information at EDIRC.
Bibliographic data for series maintained by Espai de Recerca en Economia ().