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A Study on the Unofficial Economy

Katerina Marku Shuteriqi

ISBN 10: 3845474459 / ISBN 13: 9783845474458
Published by LAP Lambert Academic Publishing
New Condition: New Soft cover
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152 pages. Dimensions: 8.7in. x 5.9in. x 0.3in.There is a significant amount of output that is produced in the unofficial sector by making use of a considerable share of productive resources. This does have important implications in the designation of effective macroeconomic policies and also for the growth and prosperity of the private sector. Economists of different countries have tried to assess the size of this sector and also analyze the factors that stimulate its expansion. In this book we built a theoretical model that defines the optimum share of the unofficial economy (hidden sales) as a function of the tax rate, the probability of evaders being caught and the severity of the punishment. By using data from firm level surveys of Albanian firms we tested the validity of this model and the results highlight that the probability of detection, the integrity of courts, the incidence of protection payment by firms and the uncompetitive practices of their rivals (all indicators of weak formal institutions), accompanied by the lack of trust in these institutions, increase the share of the UE. Better and stronger institutions not only help fight the UE but are key factors to the development of any economic system. This item ships from multiple locations. Your book may arrive from Roseburg,OR, La Vergne,TN. Bookseller Inventory # 9783845474458

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Bibliographic Details

Title: A Study on the Unofficial Economy

Publisher: LAP Lambert Academic Publishing

Binding: Paperback

Book Condition:New

Book Type: Paperback

About this title

Synopsis:

There is a significant amount of output that is produced in the unofficial sector by making use of a considerable share of productive resources. This does have important implications in the designation of effective macroeconomic policies and also for the growth and prosperity of the private sector. Economists of different countries have tried to assess the size of this sector and also analyze the factors that stimulate its expansion. In this book we built a theoretical model that defines the optimum share of the unofficial economy (hidden sales) as a function of the tax rate, the probability of evaders being caught and the severity of the punishment. By using data from firm level surveys of Albanian firms we tested the validity of this model and the results highlight that the probability of detection, the integrity of courts, the incidence of protection payment by firms and the uncompetitive practices of their rivals (all indicators of weak formal institutions), accompanied by the lack of trust in these institutions, increase the share of the UE. Better and stronger institutions not only help fight the UE but are key factors to the development of any economic system.

About the Author:

Katerina Shuteriqi received an MPhil in Economics from Staffordshire University in 2007. She has been a Lecturer of Economics and Head of Department at Univerity "A.Xhuvani" in Albania for 10 years before relocating in Massachusets and starting working for TJX Companies. Research interests: Economics of Unofficial Economy, Regulations and Taxation.

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