The Shadow Economy in Colombia: Size and Effect on Economic Growth
Friedrich Schneider ()
No 2013-19, Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria
Using the currency demand approach, size and development of Colombia’s shadow economy are estimated over the period from 1980 to 2012. The results show a great extent of shadow economic activity varying over time between 27 and 56 % of GDP. The most important factors driving the shadow economy are indirect taxation and unemployment. Analyzing the interaction between shadow and official economy, the shadow economy has a negative effect on the official one. Average growth of real per capita GDP is 1.86% between 1980 and 2012, without shadow economy it would have been higher around 0.12 percentage points on average.
Keywords: Colombian shadow economy; currency demand method; taxation; unemployment; interaction between the shadow and official economy (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-iue and nep-lam
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Journal Article: The Shadow Economy in Colombia: Size and Effects on Economic Growth (2014)
Working Paper: The shadow economy in Colombia: size and effects on economic growth (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:jku:econwp:2013_19
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