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- W27201883 abstract "In the first paper, we estimate the unrecorded economy in 49 economies from 1981 to 2005. Our study is based on electricity consumption series which are filtered to account for technological change and for the changing weight of the energy-intensive industrial sector. In contrast with studies based on the MIMIC method, we obtain a reduction in the weight of the unobserved economy. Unlike La Porta and Shleifer (2008), we identify measures of institutional quality which are significantly related to the shadow economy even after controlling for per-capita GDP. Thus the shadow economy should not be dismissed as the unpleasant side effect of underdevelopment. Instead it is related to some specific institutional aspects that may well survive even when the economy reaches higher development stages. We identify strong substitution effects between official and unofficial sectors both in the long run and over the business cycle. This has important implications for income convergence and for the relationship between volatility and growth. In the second paper, we investigate the distinct roles played by institutions, growth and in determining the shadow economy. The sharp distinction between theoretical priors on the institutional determinants of the shadow economy and the technique used for its measurement is the first novel contribution of the paper. The second innovation is that, by exploiting the time series dimension of our panel, we are able to better investigate the link between official output growth and the relative size of shadow economy. The third innovation is that we can contribute to a long-standing controversy about the distinct roles of institutions and policies in determining economic outcomes. In the third paper we reverse the standard approach typically followed in the literature on the shadow economy. Instead of exploiting money demand data to extrapolate the dynamics of the shadow economy, we explore the long run effect of shadow economy measures – obtained independently from money demand functions - on money velocity. By doing this, the original contribution of the paper is twofold. First, we improve the understanding of money velocity determinants. Second, we provide an indirect test of the reliability of the estimates on the shadow economy presented in the first paper of the thesis." @default.
- W27201883 created "2016-06-24" @default.
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- W27201883 date "2010-07-02" @default.
- W27201883 modified "2023-09-27" @default.
- W27201883 title "ESSAY ON THE UNRECORDED ECONOMY" @default.
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