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Shadow Economies around the World: What Do We Know?

Friedrich Schneider () and Robert Klinglmair ()
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Robert Klinglmair: University of Linz

No 1043, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using various statistical procedures, estimates about the size of the shadow economy in 110 developing, transition and OECD countries are presented. The average size of the shadow economy (in percent of official GDP) over 1999-2000 in developing countries is 41%, in transition countries 38% and in OECD countries 18.0%. An increasing burden of taxation and social security contributions combined with rising state regulatory activities are the driving forces for the growth and size of the shadow economy. If the shadow economy increases by one percent the annual growth rate of the “official” GDP of a developing country (of a industrialized and/or transition country) decreases by 0.6% (increases by 0.8 and 1.0 respectively).

Keywords: shadow economy; interaction of the shadow economy with the official one; tax burden (search for similar items in EconPapers)
JEL-codes: O17 O5 D78 H2 H11 H26 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cwa, nep-dev and nep-pbe
Date: 2004-03
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Working Paper: Shadow Economies around the World: What Do We Know? (2004) Downloads
Working Paper: Shadow Economies Around the World: What Do We Know? (2004) Downloads
Working Paper: Shadow economies around the world: what do we know? (2004) Downloads
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