Increasing Shadow Economies All Over The World Fiction Or Reality PDF Download

And Schneider's findings using the currency demand approach Table 3.1.3: A comparison of the currency demand and the electricity approach Table 3.1.4: Average size of the shadow economy for developing, transition and OECD countries Table 3.2: The size of the shadow economy (in % of GDP) of the early and mid-1990s, of OECD and transition countries Table 3.3.1: The development of the shadow economy. [...] The comparison of the results of the shadow economies using the different methods also shows that there is a clear ranking of these methods with respect to the size of the shadow economy, as is demonstrated in table 3.4.1: Table 3.4.1: A comparison of the different methods for calculating the shadow economy Mean value over 5 countries1) and all periods (1970-90) of the shadow economy Methods 24.4. [...] The bigger the difference between the total cost of labor in the official economy and the after tax earnings (from work), the greater is the incentive to avoid this difference and to work in the shadow economy. [...] The higher the marginal tax rate, the greater is the substitution effect and the bigger the distortion of the labor-leisure decision. [...] Finally, this can lead to an increase of the tax rates for firms and individuals in the official sector, quite often combined with a deterioration of the quality of the provided public goods (like the public infrastructure) and of the administration, with the consequence of even stronger incentives to participate in the shadow economy.