Use this url to cite publication: https://hdl.handle.net/007/16318
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Šešėlinės ekonomikos sampratų įvairovės problema
Type of publication
Straipsnis kitame recenzuojamame leidinyje / Article in other peer-reviewed edition (S5)
Type of publication (old)
S4
Author(s)
Sakalauskaitė, Rūta |
Title
Šešėlinės ekonomikos sampratų įvairovės problema
Other Title
The Problem with Variety in Definitions of the Shadow Economy
Date Issued
2019
Is part of
Socialinių mokslų studijos. ISSN 1822-8011, 2019, 11(1)
Field of Science
Abstract
Shadow economy has a lot of different names in scientific literature. For
example, it is called underground, unofficial, informal, alternative, second, parallel,
illicit, illegal, irregular, cash, hidden, non-observed, unobserved, unrecorded, subterranean, occult, black and etc. Although these concepts seem to be similar, they have
different meanings. Due to the complexity of economic processes (Dell’Anno, GómezAntonio, & Alañon-Pardo, 2007; Krumplytė, 2008, 2009; Maskvytienė & Valuckaitė,
2017; Misiūnas, 1999; Nikopour, Habibullah, & Schneider, 2008; Schneider & Enste,
2000; Schneider & Hametner, 2007)namely France, Spain and Greece. A multiple indicators and multiple causes model based on the latent variable structural theory has
been applied. As established by Giles (Working paper on monitoring the health of the
tax system, 1995, the shadow economy covers many areas. Therefore, each researcher
choses which field to investigate and defines one`s own concept of the shadow economy.
Due to this reason, scientific literature faces the problem of the variety of definitions
of shadow economy definitions: as each author defines their own concept of the shadow
economy, research in this area lacks continuity and comparability of results. Thus, the
aim of the article is to propose a unified definition of the shadow economy.
It is done by comparative analysis of various concepts, e.g. informal economy, underground economy, shadow economy. Each concept is described in a structured way
by applying typological classification to each subtype. After comparing different types
of informal economy, underground economy, shadow economy concepts, the unified
definition of shadow economy is suggested.
Taking into account the prevalent conceptions, reasons for involvement and nature
of shadow activities, the author of this article distinguishes three types of the shadow
economy - underground, informal and illegal. The underground economy covers legal
market output (e.g. undeclared income from legal activities, envelope salaries, hidden
income, hidden value added or other taxes). The illegal economy includes illicit production (e.g. drug trafficking, illicit alcohol, smuggling). The informal economy covers
output from entities that have no obligation to register or output for private use (e.g.
own-account production of households, auxiliaries). Summarizing the concept of the informal economy, the following conclusion can be
done: shadow economy is a market-based process that violates legal regulation or otherwise adversely affects state’s tax revenue and financial interests where public authorities are not formally aware of such activities due to tax avoidance or other benefits.
example, it is called underground, unofficial, informal, alternative, second, parallel,
illicit, illegal, irregular, cash, hidden, non-observed, unobserved, unrecorded, subterranean, occult, black and etc. Although these concepts seem to be similar, they have
different meanings. Due to the complexity of economic processes (Dell’Anno, GómezAntonio, & Alañon-Pardo, 2007; Krumplytė, 2008, 2009; Maskvytienė & Valuckaitė,
2017; Misiūnas, 1999; Nikopour, Habibullah, & Schneider, 2008; Schneider & Enste,
2000; Schneider & Hametner, 2007)namely France, Spain and Greece. A multiple indicators and multiple causes model based on the latent variable structural theory has
been applied. As established by Giles (Working paper on monitoring the health of the
tax system, 1995, the shadow economy covers many areas. Therefore, each researcher
choses which field to investigate and defines one`s own concept of the shadow economy.
Due to this reason, scientific literature faces the problem of the variety of definitions
of shadow economy definitions: as each author defines their own concept of the shadow
economy, research in this area lacks continuity and comparability of results. Thus, the
aim of the article is to propose a unified definition of the shadow economy.
It is done by comparative analysis of various concepts, e.g. informal economy, underground economy, shadow economy. Each concept is described in a structured way
by applying typological classification to each subtype. After comparing different types
of informal economy, underground economy, shadow economy concepts, the unified
definition of shadow economy is suggested.
Taking into account the prevalent conceptions, reasons for involvement and nature
of shadow activities, the author of this article distinguishes three types of the shadow
economy - underground, informal and illegal. The underground economy covers legal
market output (e.g. undeclared income from legal activities, envelope salaries, hidden
income, hidden value added or other taxes). The illegal economy includes illicit production (e.g. drug trafficking, illicit alcohol, smuggling). The informal economy covers
output from entities that have no obligation to register or output for private use (e.g.
own-account production of households, auxiliaries). Summarizing the concept of the informal economy, the following conclusion can be
done: shadow economy is a market-based process that violates legal regulation or otherwise adversely affects state’s tax revenue and financial interests where public authorities are not formally aware of such activities due to tax avoidance or other benefits.
Type of document
type::text::journal::journal article::research article
ISSN
2029-2236
Language
Lietuvių / Lithuanian (lt)
Access Rights
Atviroji prieiga / Open Access