Journal of Economic Literature Vol. 38 No. 1 2000

Shadow Economies: Size, Causes, and Consequences

Friedrich Schneider¹; Dominik H. Enste²

¹ Johannes Kepler University of Linz, Austria. · ² University of Cologne, Germany

Abstract

Using various methods, the size of the shadow economy in 76 developing, transition, and OECD countries is estimated. Average size varies from 12 percent of GDP for OECD countries, to 23 percent for transition countries and 39 percent for developing countries. Increasing taxation and social security contributions combined with rising state regulations are driving forces for the increase of the shadow economy, especially in OECD countries. According to some findings, corruption has a positive impact on the size of the shadow economy, and a growing shadow economy has a negative effect on official GDP growth.

DOI

10.1257/jel.38.1.77

Volume

38

Issue

1

Pages

77-114

Language

en

Sources

crossref openalex

Cite

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