The Shadow Economy

This book presents new data to give an overview of shadow economies from OECD countries and propose solutions to prevent illicit work.

This original and insightful handbook presents the latest research on the size and development of the shadow economy (also known as the black or underground economy), an integral component of the most developing and many developed countries' economies.

In this revelatory book, Sudhir Venkatesh takes us into Maquis Park, a poor black neighborhood on Chicago's Southside, to explore the desperate and remarkable ways in which a community survives. The result is a dramatic narrative of individuals at work, and a rich portrait of a community. But while excavating the efforts of men and women to generate a basic livelihood for themselves and their families, Off the Books offers a devastating critique of the entrenched poverty that we so often ignore in America, and reveals how the underground economy is an inevitable response to the ghetto's appalling isolation from the rest of the country.

Issues such as tax evasion and the size and impact of the shadow economy have ranked highly in political and economic policy debates across the globe in recent years. Yet, despite various methodological advances and growing empirical evidence, there are still large areas of interest that have not been explored, or where scientific research efforts are still in their infancy. This timely book addresses such issues from various perspectives in order to demonstrate the extent and scope of tax evasion, the shadow economy and their interaction. Leading scholars examine recent evidence from theoretical and empirical research on tax compliance and tax evasion, and provide an in-depth analysis of underlying methods. Strategies to fight tax evasion are evaluated and the motivations behind it are explored, as are the impact and size of the shadow economy in Europe. As well as promoting a better understanding of the issues, this book intends to stimulate further debate and, in so doing, broaden the exchange of ideas and concepts. Comparing and contrasting differences and common elements of both tax evasion and the shadow economy, this unique book will prove a fascinating and enlightening read for scholars of economics in general, and public sector, public choice and Austrian economics more specifically. Professionals in ministries of finance and national offices of statistics, dealing with tax evasion will also find the book to be an illuminating read.

The main objective of this book is to develop a strategy and policy measures to enhance the formalization of the shadow economy in order to improve the competitiveness of the economy and contribute to economic growth; it explores these issues with special reference to Serbia. The size and development of the shadow economy in Serbia and other Central and Eastern European countries are estimated using two different methods (the MIMIC method and household-tax-compliance method). Micro-estimates are based on a special survey of business entities in Serbia, which for the first time allows us to explore the shadow economy from the perspective of enterprises and entrepreneurs. The authors identify the types of shadow economy at work in business entities, the determinants of shadow economy participation, and the impact of competition from the informal sector on businesses. Readers will learn both about the potential fiscal effects of reducing the shadow economy to the levels observed in more developed countries and the effects that formalization of the shadow economy can have on economic growth.

During much of the twentieth century, informal employment and entrepreneurship was commonly depicted as a residue from a previous era. Its continuing presence was seen to be a sign of "backwardness" whilst the formal economy represented "progress". In recent decades, however, numerous studies have revealed not only that informal employment is extensive and persistent but also that it is growing relative to formal employment in many populations. Whilst in the developing world, the informal economy is often found to be the mainstream economy, nevertheless, in the developed world too, informality is currently still estimated to account for notable per cent of GDP. The Informal Economy: Exploring Drivers and Practices intends to engage with these issues, providing a much-need ‘contextualised’ approach to explain the persistence and growth of forms of informal economic practices and entrepreneurial activities in the twenty-first century. Using a diverse range of empirical case studies from Europe, Africa, North Africa and Asia, this book unpacks the different varieties of forms of informal work and entrepreneurship and provides a critical analysis of existing theorisations used to explain such phenomena. This book’s aim is to examine the nature and persistence of informal work and entrepreneurship, across a variety of empirical settings, from within the developed world, the developing world and within transformation economies within post-socialist spaces. Given its worldwide, interdisciplinary and multidisciplinary approach and recent interest in the informal economies by a number of disciplines and organisations, this book will be of vital reading to those operating in the fields of: Economics, political economy and management, Human and economic geography and Economic anthropology and sociology as well as development studies

Examines the role of the shadow, or underground, economy. Looks at ways of measuring it, the relationship between the shadow economy and the main stream economy, why it has been growing in size, and its effects on overall economic growth. How can states limit the size of the shadow economy, and does it matter that it exists?

Bringing together top international researchers this book provides a worldwide coverage of underground economic activities. It presents estimates of the underground economy for 145 countries - the most comprehensive ever undertaken; an in-depth examination of the underground economy for a select number of these countries; and an analysis of the public policy implications through an assessment of how various governments have attempted to address this issue. The book brings together the latest research on tax evasion, tax morale and other underlying factors that have so significantly influenced participation in the underground economy. It provides a comprehensive overview of the size and development of the underground economy, its major causes and motivations and its effects on the legitimate economy. In addition, it reviews recent public policy concerns by a number of countries and how they have responded with measures to curb these underground economic activities.